tv U.S. Senate CSPAN August 15, 2011 12:00pm-5:00pm EDT
contend with building it in later on. so i just want to conclude by thanking heritage for, as always, using its bully pulpit to good effect. there are a couple of other days that i'd like you to declare while you're at it. [laughter] but i'm certainly delighted -- [inaudible] one day at a time. [applause] >> thank you. my ph.d. dissertation dealt with underground shelters, i served as an intelligence officer in the air force, and i worked for the department of defense. i'm very particular familiar with both emp threats and other national security threats, and i've written in journals like joint force quarterly, and that's why i wrote yet another novel about emp and other threats called row ha nation, and i did that because i wanted to make people aware of the threat as we're trying to do
here today and also to get the issue out that the government is not protecting you against these threats, and you need to be prepared not just for devastating attacks, but for the collapse of society. it's caused by both emp and viral warfare, and for those of you who are not familiar with lord of the rings, the rohan is a post-force nation. the emp attack in my book is launched from a civilian airliner that launches two scud missiles over the united states, effectively covering the united states. and as the congressman pointed out, you want to get them up higher, so launching from an aircraft helps you do that. i just read last week that the israelis are planning to launch satellites from 747s over the indian ocean, and this has been done in the past. again, emp and all these methods we're talking about, these are not new threats, they're actually old technologies, very
feasible. so an emp launched from a civilian airliner would be nearly impossible to stop and difficult to attribute who launched it. some civilian airliner, we'd be so weakened by an effective attack i'm not sure we'd be in a very good position to retaliate. i'm also surprised when i read studies that everyone seems to assume there's going to be no advances in nuclear technology. everyone's going to build huge centrifuges using technology that comes, basically, from a world world war ii era. we should not assume that knowledge of physics and science won't lead to new mets to create -- methods to create nuclear-weapons material. i think projections are very far off because there's new technologies enabling people to create weapons, and as this panel's already pointed out, it does not take much to build an emp-effective warhead. the proposal of the work for
complete u.s. nuclear disarmament i think is a very bad and dangerous idea, and i'd like to point out what may be an even more devastating threat is bioengineered viral pandemics. iran is very likely using the same dna manipulation in bioengineering technology that we're using to develop new medicines to bioengineer deadly viruses. in the past we assumed that bioweapons would not be used because a nation like russia was going to be deterred because they'd be worried about the rye us have eventually spreading back to russia and hurting them as well. but if you're developing, you have the ability to develop not just a new virus, but a vaccine for that virus that only you have. so at that point if iran does something like that, they've got the ideal weapon to wipe out the united states and israel and just give the vaccine to those they really care about. a preemptive bioweapons attack,
we must maintain a nuclear force ideally with a policy and administration that will clearly use nuclear weapons to punish, destroy and deter such attacks. unfortunately, we have no such policy or resolve in the current administration. the latest nuclear posture review, for example, led to perhaps some of the worst decisions this administration's made, a declaration that you can attack the united states with biological weapons, and we promise not to reply with a nuclear weapons attack on you. you really ought to look that over, the it's just appalling te statements and the policies that were changed in this latest review. when you consider the threats of emp and bioengineered viruses and the policy that the u.s. will not use nuclear weapons against our enemies, you realize the security threats we face are probably much worse now than the cold war, yet our federal government seems to be too busy pandering with social initiatives to solve these problems.
libertarian groups have argued about these unconstitutional programs that weaken our economy and distract the federal government from its primary job of national security, but unfortunately, it continues. so i wrote rohan nation part of as an atlas shrugged type call to stop these programs that both directly and indirectly weaken our national security both by taking funds from defense, funds from emp preparation and defenses and recovery means and be also shifting the focus of the national government from socialism and economic/political programs back to its overriding main mission which is simply national security. americans need to prepare themselves to deal with the consequences of emp, nuclear war and viral pandemics. you should not put faith in the ability of the federal government to protect you against these threats. i put an arbitrary date in my book of 2020 for the collapse. the disaster described could take place at any time. the emp threat is now decades
old, and it gets worse every year because of our reliance on electronics and computer chips that increases every year. by the way, most of these chips are not made in the united states, most are made in china, taiwan and korea so good luck getting replacements. there are more people to feed, fewer farmers and more dependence on just-in-time delivery of food and resources. and it's also worse every year because our military with its tremendous conventional superiority is dependent on high-tech weapons and computer chips. that's clear as the congressman has pointed out, it is a clear, obvious achilles heel for our military. if you want to defeat the united states military, start the attack with a high-altitude emp attack, and any fool can figure that out. someone smart enough to attack us with a high-altitude emp is also going to be smart and ruthless enough to koma wine that attack -- combine that attack with a bioengineered virus that they have a vaccine for and we don't.
the u.s. commission on the prevention of weapons of mass destruction warns that a terrorist attack with bioweapons was likely by the end of 2013. this warning was issued years ago, but very few americans know about it, and almost no one in congress and the administration is focused on this greatest threat to our suffer vial. the brookings institution, interpol, many scientists have written and warned that these advances in the engineering and manipulation and bioengineering give the ability for even a small terrorist group, even an individual could use very cheap, available equipment and today's technology to do what the soviets did back many the cold war, which is they combined the ebola virus with smallpox which is highly contagious. and if they create a brand new, deadly virus, they can also add in the gene that makes the virus vulnerable to a vaccine they create. so if they want to protect their chosen people from the vaccine, they can do that. we've already had cases, i should point out, where
scientists tried to use dna manipulation to create good means had accidentally created lethal viruses. fortunately, just in the lab so far. don't count on the federal government to protect you from emp or viral pandemic threats, they're too buzzy pandering with unconstitutional programs, it seems, to be bothered with vital measures. it would be great if cato institute, ron paul and the tea party could convince folks to obey the constitutional limits, focus on security, but that's probably an unlikely thing to happen. so my second conclusion/recommendation is as individuals and families you need to prepare for these disasters, have your own means of being able to survive these. the prepper movement is big in the united states, it's getting bigger all the time, and there's sales of bunkers that have been growing in the united states as you read in the paper this year, there's survival communities being formed in the united states, and be you, too, should prepare for surviving the kind
of postcollapse environment described in the rohan nation: reinventing america after the collapse. thank you. [applause] >> so we're going to open it up to our panel for questions. if you'd just raise your hand, and i'll recognize you. and then if you would wait for the microphone and announce your name and affiliation, that'd be great. i just wanted to add two very quick points because if you're not depressed enough -- [laughter] so, you know, this is a dynamic problem, right? >> because our infrastructure and our technology is changing all the time. so part of the evolution and technology is to actually create processers that require less and less power. so we need smaller and smaller batteries. and so we can be more and more efficient in the use of electricity. of course, as that actually makes those systems even more vulnerable to everything mp surge. l so -- to emp surge.
so as we're racing forward, we're also making incredibly vulnerable electronic systems. you know, the flip side is, one thing we didn't talk about is we talked about some of the protective measures and others, many be of these fall in the category of what's called all hazards or multiuse response. so even if you never experience an emp attack or be we're all lucky to outlive before the next solar flare, that's not to say a lot of these measures would go to waste. when you look at our paper about reviewing what the department of homeland security hasn't done in terms of planning and preparedness and coordination and some of the measures that the defense department hasn't done, these things would be useful and productive and helpful for our security and prosperity for a whole range of things; from conventional attacks this some instances to natural disasters. so it's not like you're saying we're just buying something that's for a once in a, you know, maybe million-year event. these are actually efficacious
measures for lots of the kind of dangers we might be concerned about. so the young lady in the back was very patient, so -- >> yes, hello. my name is lauren gilbert, a student at american university. and my question, i suppose, would be there was a very brief mention about getting private industry involved in the meantime until the government can do something. my question is, what are the sorts of things that could be done at the level of utilities such as, say, exxon or duke? what are the levels of things that could be done at regulatory authority such as, say, pjrm or miso? and then what would be beyond anyone's scope and would need to be handled by the government? >> so i'm going to ask congressman bartlett to talk to that and also peter. so if they would start, and i would ask our panelists to really refrain from using acronyms because probably most of the world doesn't know what they are. >> okay. [laughter] as -- to ask the power industry
to do this without some education and authorization and encouragement is asking an awful lot. the cost of electricity is going up anyhow, and this would simply add to that cost. not exorbitantly, by the way. it was 60 cents to each bill for each person who buys electricity over a how many year period would provide the kind of, would pay for the kind of hardening that we need. it's primarily a matter of education. once we know that you need to do this and americans understand that, gee, that extra 60 cents is very well spent, isn't it, then i think that it will do it. but absent that, it's going to be awfully hard for these people to justify increasing their costs and increasing the billing to their, to their subscriberses. so i think it's education, and i really want to thank heritage for doing this because we need to do this a thousand times over
so that people understand how important this is. and it isn't just for emp. i'd like to second what was said about personal preparedness. you know, i am old enough to have lived through the cold war. and remember those old cd emblems up this and food was -- up there and food was stored? you couldn't go to any public building without having a bunch of bro sures that told you -- brochures that told you what you ought to do and except for the duct tape and can plastic that embarrassed homeland security, they tell me they have this information, but nobody knows it. everybody ought to be doing personal preparedness because we're only going to be -- we're going to be as strong as a nation as we are individually in a catastrophic situation like this. and there's no reason that you can't be independent of the system for whatever period of time your finances will permit you to be independent of the system. and it's just a matter of
education. and i'm really quite distressed that we are not doing that. because, you know, you think about it, if you go out and if you buy supplies and food ahead of time, you're now a patriot because a farmer has to grow it, somebody has to sell it, and you're helping the economy. if you do it when the hurricane is at your door, you're a horder. when you do it depends on whether you're a patriot or a sinner, doesn't it? >> peter? >> um, theoretically industry could do it on its own. currently, the north american electric reliability corporation, in fact, is objecting to passage of the shield act, insisting that they don't need, you know, federal regulation, that they can do this on their own and will do it on their own, and that's the argument that they're making. i do not believe that, you know, because we've known about emp, and the commission made its recommendations, oh, beginning back in 2004, and they haven't done anything.
you know, they are also, frankly, i mean, as they should be, driven by the profit motive. i'm a small government conservative as is mr. bartlett. there are probably no other member of congress as small a government conservative as he is. but, you know, liberal democrats, conservative republicans alike are united that this is a legitimate role where you do need government, you need to give the legal authorities to ferc so that it can require industry, you know, to move forward. it can't -- it doesn't have the legal authorities yet, that's why the shield act is so necessary. um, they'll have an opportunity, and they've got an opportunity now to, actually, move forward on their own, and ask they should be encouraged to do so. but that doesn't obviate the need, you know, for the government to exercise its responsibility, too, since people's lives depend on industry doing the right thing. >> explain what ferc is for people. >> right. you know, that would be the, that's the chief agency that we would be looking to to, you know, to implement the
provisions of the shield act. >> spell it out. >> federal agent -- [inaudible conversations] >> federal edge regulatory -- energy regulatory commission. thank you. sir. >> hi, i'm dion pollack from the zionist organization of america. for those of you who have experience and intelligence in government, especially the congressman, something's missing here. we have a very large infrastructure of professional intelligence people who make a living studying our adversaries and what they intend to do to us, and how are they not communicating with the leadership of our military and to the congress that this is something that needs to be defended against? i'm, i'm a little bit unclear about why our professional intelligence establishment is not advising congress to take action. >> right. maybe drew and frank could start with that. >> i'll just tell you for the intelligence committee, it's a
cardinal rule, you do not make policy. you provide the information, it's up to them, and you will not find intelligence folks advocating policy. so they'll make the information available, and that's it. >> the question occurs, and peter may be in a position to answer this or roscoe better than i, whether the information is being provided. and i certainly, um, have heard from peter about this super-emp weapon. i'm not sure that policymakers have been hearing about the north koreans having successfully developed a super-emp weapon. um, as to the policy piece of this, i think that -- and i've had some of these conversations, and i know others here have as well with people in previous administrations as well as this one. you get sort of this blank look from most of them with the sort
of -- >> more than blank than usual? is. >> even more blank than usual. with sort of the sense that it's got to be somebody else's problem, not theirs, or it's not as serious a problem as you're making it out to be. and i think the combination of maybe not getting actionable intelligence and belief at a time when there's so many other things to worry about, this is in the too hard or not absolutely high priority category seems to be contributing to the inaction we're talking about. >> peter? >> well, having served a decade in the intelligence community of the cia as senior analyst for emp at that time, i know that at least when i was there -- this was during the cold war and be after the cold war up until 1995, you know, we were informing, you know, policymakers that there was a serious everything mp threat. but frank is absolutely right when it comes to policy issues
in terms of policy recommendations about what you do about it, that is crossing the line. you know, you can talk about the threat, you can't make recommendations. that's up to the policymakers which is one of the reasons i left the intelligence community, by the way, so i could get on to fixing the problem side of it. [laughter] now, it's amazing to me how even in if washington, d.c. it doesn't seem to be widely understood what the purpose of congressional commissions and presidential commissions are, you know? i mean, the reason these things exist, the reason a commission was established is precisely so you can have an authoritative statement that includes the collective views of defense and intelligence and the scientific communities. so the intelligence community has spoken loud and clear already in terms of the threat anyway in the emp commission report, you know, because they were part of that process and a consensus emerged from that report. second, there was the strategic posture commission report after the emp commission, you know, which re-examined this threat, could rogue states and
terrorists do this? and this was the commission that was headed up by bill perry who was president clinton's secretary of defense. it came to exactly the same conclusion, okay? so it's been through the process at least twice. then we had a national academy of sciences study after that that confirmed independently the threat from magnetic storms. and then there was a june 2010 study by department of energy and ferc, the federal energy regulatory commission -- [laughter] that went back and said, yes, indeed, there are geomagnetic storms, this is true, and rogue states, terrorists, they can do this. and then last in september 2010, the ferc sponsored a big interagency study that included the intelligence community and the nuclear weapons labs, and they all came to the same concurrence. there isn't one official study that dissents from the original view. they all support each other. so we've had, basically, the equivalent of, yowx, two congressional commissions plus
three major authoritative studies that have all said the same thing. now, why don't people still know about it? i don't know. i mean, it's, you know, maybe it's because you say emp, and people's eyes glaze over. it's an esoteric -- even among the nuclear weapons experts when i was working in the field, and be i think it's the case today, there's a narrow subset of defense scientists who really understand this, and it's kind of a small e soar esoteric grouf people who understand it. and we've got -- and it has been classified for many years. it wasn't really until the commission came out with its first reports, and mr. bartlett conducted the first congressional hearings, you know, that we actually came out of the classified closet to the public at large. so in a sense even though it's an old threat that we've known about, specialists have known about for a long time, where the public is concerned this is actually new information, and it's a steep learning curve we've got. you know, it doesn't help that it's such an esoteric, difficult thing to understand.
>> did you want to add to that? >> the primary deterrent is the tyranny of the urgent, it always sweeps the important off the table. you change the baby's diaper, the college education saving for that is really more important, but it's not urgent. and that's true in our government too, you know? >> it's the tyranny of the urgent. the urgent always sweeps the important off the table. i don't know how you get around that, but we clearly need to. >> well, i'm really appreciative of all the questions. we'll get to as many as we can. you had a question down here. just wait for the microphone, please. >> thank you. be none of you have mentioned the possible power of public opinion, and in my town which is bethesda and my circle i'm not aware that people have any idea of the possible dangers that face us very imminently.
why hasn't public opinion been harnessed in some way? there's a plethora of material, you've told us that, that somehow could be, i'm an ex-journalist, that somehow could be told in a way that ordinary people like me could understand and, perhaps, am i being too simplistic, put pressure on these lax government entities that aren't doing anything even though they know of the danger? >> could i add one plug here for peter pry and the work that they're doing and the books that are being written on the subject and the movie i think is coming out of bill's book? i think some work is being done in a very serious way on this, and what you have just said is a call to intensify that effort. >> and, of course, have that great film "oceans 11," right? sadly, the lights come back on
during the movie. [laughter] peter, do you want to jump in? >> i want to answer the question of why what could be done has not been done? when you went to the utilities and when ferc said there's not a problem, then when they proved there's a problem, they said there's no solution. right now there is a number of companies that are working with some very large microsoft-type companies that are actually going to build systems that can protect the transformers. they're going to build them and demonstrate them. the problem is we needed $3.5 million to pay the idaho national labs, so this big company has come up with the money. that's number one. second issue, it looked like you were going to shoot down a missile. that's missile defense. a lot of people don't like missile defense, so they denied there's a problem. if you remember, the president wrote a piece in the times, he said -- the science adviser said it's not going to come from a rogue state, it's going to come from the sun. but then they stopped there. a third thing which i think is
very important is not just the utilities who didn't believe there was a solution, and it was too costly and it was only a geomagnetic storm is that the solution becomes so big that they deny there's a problem. and until you translate the solution into something that's very doable which peter has done a great deal about, then people, i think, would come onboard in terms -- because a lot of people, like, in the intelligence community said, oh, forensics will take care of it. we'll know what nuclear material looks like in the clouds, we'll sample it like we did in north korea, and we'll find out whose bomb it was. that's only if you have a sample of all their bomb material, and the north koreans and iranians aren't about to give it to us. oh, deterrence works or, if we can't tell where it's come, nuclear forensics will work. so you deny the problem so you don't have to face the solution. as peter said, it's no more than a dollar a year to a person's utility bill, and they can charge it to the rate.
so i would say that that is the second part of this solution that we haven't yet got to, that the solution is affordable and doable. >> thanks. so new technologies and missile defense. yes, sir, right there. >> george nicholson. congressman bartlett, with all the work that you did on the sea power committee and now your new committee, the concern we've seen the export in technologies so that hezbollah was able to launch a missile against a state of the art israeli patrol boat, the u.s. navy sitting out there with a carrier battle group, what's your comfort level that they're going to have the defensive capability of protecting themselves as against an emp attack? >> unfortunately, as i mentioned, ever since the clinton years when we had a big decrease in military funding, we have been waiving hardening on all of our new weapons systems. they just aren't hardened.
as i mentioned, i had a huge problem with that, and it's on the congressional record, you can pull it up. i questioned over and over why would we build the weapons at all if we weren't hardening them? because the only time we really need those weapons is against a fear or near fear, and one of the things they're going to do, it's in all of their literatures and war games, is a emp robust laydown against all of our weapons which are not emp-hardened which, today, are essentially all of our weapons. world war ii stuff would have been just fine there. we did it quicker and with less fatalities with our new went weapons, but we didn't have to have them to win those wars. they're not emp-hardened, you know? at least now as a result of the commission they have a standing it is a act force -- task force in the pentagon looking at
emp-hardening across the services. i'm not confident that they are looking at a serious enough threat. i think the level of emp they're looking at is, it's classified, but it is too low. i think if what the russian generals told the commission is true, what we're preparing for is a fraction of what our enemy is capable of, then that doesn't make much sense. >> we have just a few minutes, we're going to try to catch these two questions in the middle there. >> my name's jeff mcgee, and i'm working with a trusted supplier of microelectronics. cultural awareness, i was going to say dr. miller's book sounds like a great blockbuster for hollywood to make into a movie, and if there's other movies like that, because "oceans 11" did misportray the threat. it's like the ultimate weapon. if you can get the emp, you can take out your enemy.
[laughter] so, but my real question is as far as comparing this, making an analogy to the arms race or a preparation race, are there any other nations that are actually on the ball and preparing their grids? >> so, peter, maybe you could talk about what's going on globally in terms of how people are treating this. >> sure. russia and china, russia was prepared all through the cold war, and, you know, china also has its grid prepared. some countries that are much less developed than we like north korea because of their backwardness, you know, would be virtually invulnerable to this. they don't depend on the electric grid the way we do. of iran is more dependent upon, but even they are not nearly advanced as we. we know in terms of offensive capabilities they are preparing to use weapons. it's an open source, north korean in writing iranian
military doctrine, they openly write about taking us out as an actor. in the case of iran, i think mr. bartlett mentioned, you know, doing several tests with the shehab iii. they have even launched a missile off a vessel in the caspian sea, you know, the nightmare scenario is the one frank gaffney mentioned where they would use a scud in a bucket, i think people call it, you know, where you use some primitive missile, get it close to our shores, do it off the gulf of mexico. and peter is also correct that, you know, that you would not be able to identify the attack not only because the missile would not come from enemy territory, but you can't do nuclear forensics on an emp attack. it's out in the space, so there's nothing to collect. >> so this is the last question. >> well, there's been a lot of talk about the big one coming in
2012, 2013 from the sun. but if you look at the history of geomagnetic storms, you'll see that it doesn't respect the maximum, and it could come this year, it could come next week. we had one last week that was so big, it just wasn't directed at us. the sun is throwing these off regularly. but you could have a partial hit. and this is something that, i think, needs to be addressed is that it could be a scud in a bucket, or it could be a partial geomagnetic storm that puts us out for a month or two. and we need to be prepared for that. it's one thing to think of the big one, and it's another -- how are you going to get through the next month or two months? and it's not just the people who are involved and their families to think about, but it's corporate america. are we going to our corporations, saying to them can you survive one month or two months without electricity?
what will you do? because we want our corporate america to be strong coming out of this in the one or two months. could you address that, please? .. between whether to replace it. there is two competing satellites for replacing this thing. one of them is called a sentinel. it is much better-designed in this dedicated to this purpose.
but even if you get that space i satellite up, one of the myths that's out there perpetrated by some in industry say, well, you know, we can use these satellites to get early warning of a great magnetic storm and close the grid down, shut the grid down so it won't collapse, all right? first of all, while we can see solar flares and injections coming a few days before they reach the earth, they travel a million miles-an-hour. the sun is 96 million miles away we don't know if they will actually hit the earth until about 10 or 20 minutes until they get detected by the satellite. you have only 10 or 20 minutes of warning where sure it will hit the earth and will it cause at electromagnetic storm over the united states? we don't know that so you will shut the whole grid down in the united states? you're not sure there will be a electromagnetic storm. shutting the grid down would
catastrophic itself. if you can imagine that. there is no any plan to do it despite misrepresentations of some in the industry to the senate in this respect. there is no plan to do it. we never practiced it. base kpli we're not prepared even against that phenomena. i don't want people to despair. all the talk has been about catastrophic a nuclear and natural emp has been. the commission work and other studies is good news story. there is really no excuse for our society to be vulnerable to this. we know how to fix the problem. doesn't cost a lot to fix the problem. some of the solutioning while it sounds complicated. let me give you example one of the things we can do. if you put a metal shed over the big transformers, a shed with no windows, the kind of thing you get from lowe's for example, around a big transformer, now it is inside of a farraday cage. that is what you could do to
protect against the e-3 part. a big met tall shed. it could protect it against a sniper. if a terrorist would use a high powers rifle tom shoot a hole to drain out the cool lant. you protect against that too. also the most common failure mode in hurricanes and tore made dors and transformers is tree falls on them a they are completely unprotected a metal shed will protect against that too. you don't have to be a physicist to understand how some of this stuff works. it is very common sense kind of things. if you add to the metal shed a surge a rest store into the lines on the transformer which a censor picks up a pulse something different coming into the line that will protect you against the emp coming down the line. it will protect you against cyber warfare the way cyber attacks. the wave form, the way the energy comes in to come in
different way the energy surging through the power grid ends up destroying itself self. the surge a rest tore will protect us against. why haven't we are doing it? let me close with this we don't, it was remarked by mr. bartlett, we don't make among the many things we don't make in this country anymore, we don't make the big transformers anymore. they were invented in this country. the electric grid was invented in this country by tesla in new york was the first electric grid in the whole world. we exported technology for electric grids all over the world. we don't make it here anymore. the big transformers are for export purposes only made by two countries in the world now. south korea and germany. we buy our big transformers from them. takes 18 months to build one. each has to be custom-made, custom made. that is a, i would like to
see that change as matter of national security policy in my view. something as important as big transformer or systems that american lives depend on it they should be made in america again and we ought not to be dependent importing them from overseas. the and there's a lot of things people can do has been mentioned. i wholly endorse comments that have been made. we're not helpless at the individual level. there are a lot of things, if people engaged in the old-fashioned, you know, preparedness, individual preparedness that my father's generation, the generation that lived through the great depression, world war ii never heard of emp i often said they would have been prepared for a emp event and probably had a good time. they would have, they, had a garden. knew how to hunt and fish. they wouldn't know what to do with leisure time would be oriented towards these things. if those values go back to our pioneer roots that have been lost it seems in a
single generation. we used to pride ourself on rugged individualism and self-sufficiency not being dependent on the system. these values have been loss. even against emf you can do. get a garbage can with a tight-fitting lid okay, and electronics, communications electronics or medical equipment you need or want to have spare electronic parts necessary to run your car, you put them in a plastic bag, put them in a garbage can with tight-fitting lid that will survive even super emp. that car badge can with tight fitting lid is farraday cage. there are things we can do preparedness generally so we don't have to be so vulnerable and be dependent on washington. we can lead from the bottom up. i believe if people prepare as individuals bureaucrats in washington will notice and take action. they don't like to follow the parade. they pretend they're leading it. >> we're out of time. join my thanking our panel.
just a couple things quickly. if you found the program informative and helpful and want to share it with folks, tomorrow it will be archived on our website and you can go to the event link and you can send the link to anyone and it will be there forever until the next emp event. [laughter] and they can watch that program. they're also, there are paper on what the government has done so far. that will be up on the website. and our paper is talking about national emp awareness day. also if you go to the heritage website which is heritage.org there is an except from a documentary, 33 minutes, which in about six minutes explains with actually bill graham who is the chair of the emp commission, exactly how an emp works. you can watch that. if you want to you can go to the documentary website which is 33minutes.org and watch the entire film online for free. with that, thank you all for coming today and please join with me thanking our panel. [applause]
>> president obama is beginning a three-day bus tour visiting minnesota, iowa and illinois to talk about job growth. coming up around the top of the hour we'll have live coverage on c-span of a town hall meeting in cannon falls, minnesota. later in the day the president is scheduled to hold another town hall in decora, iowa. 2:30 eastern live on c-span2. the 60-plus association hosted a discussion on social security. we'll hear from several economists from the obama and bush administrations about ways to reform the program and the politics surrounding the issues in the run-up to the 2012 elections.
>> tonight on the communicators, we'll hear about legislative proposals in congress for addressing the issue of cyber security. our guests include texas representative, mac thornberry, chairman of the republican task force on cybersecurity and rhode island democratic congressman, jim langevin who cofound the first-ever cybersecurity caucus in 2008. "the communicators" airs monday nights at 8:00 eastern on c-span2. all this month watch "booktv" in prime time on c-span2 2. tonight politics and the american novelist. at 8:30 p.m., robert hurst, the autobiography of mark
twain, volume i. at 9:50, david reynolds discusses of the mightier than the sword and "uncle tom's cabin" and the battle for america. after that at 11:15, hair rid rise, al cot the woman behind, "little women." "booktv" all this month on c-span2. next we'll hear about u.s. military operations in afghanistan from the commander of nato's training mission in the country as well as the president of the national defense university. in june president obama announced plans to with draw 10,000 troops by the end of this year and 23 thousand more by september 2012. amounting to about one-third of the 100,000 troops in the country. this discussion hosted by the u.s. institute of peace is just over an hour. >> it is my great pleasure to welcome you to today's
moda program event. those joining us from home or online who are wondering what moda is, i will read you the official moda description. it stands for ministry of defense advisors program. it is really about building effective and accountable defense institutions overseas in which our government partners with american defense, civilian experts from washington and around the country going to afghanistan to work with foreign counterparts to build sustainable peace. and so it is a great privilege to be here today with some of the people who have actually participated in the moda program. now i'm told i should tell you a little bit about the united states institute of peace. i have a sense everyone in this room knows quite well but for those again hearing
about it for the first time, we are a international conflict training center that is absolutely devoted and committed to the prevention, management, and resolution of international conflict. we believe deeply and passionately in building local capacity overseas to stop violent conflicts before they start, to mitigate against violence, if they start, and to deal with the painful and often expensive and tragic outcomes of international conflict once they are resolved. and so it is really in that spirit of working toward solutions around the world that we gather here today. we also believe in the power of innovation and to innovate is really to take
ideas and turn them into action and that's what we've done in partnering with the moda program. let me give you just a little history on the program you actually get to meet the live human beings that participate in it. 2 1/2 years ago a conference organized by the center for complex operations and moderated by a united states institute of peace expert, nadia gersbacker, who brought her talents and innovation to the notion of parps. and so the united states institute of peace which has an academy of international conflict management and peace-building generated, with help from others, a foundation of thought and a plan of action that would contribute to the now
successful moda training program. as a result of that conference where people come together and share ideas, we were able to produce an ideal curriculum. and then working closely of course with the moda team and with frank digovani from the department of defense and personnel and readiness office, this group was able to operationalize a curriculum into an intense preparation program preparing senior professionals to deploy to afghanistan to build and work on creating organizations to sustain the peace. the program has grown since the first class in may 2010 with 17 advisors. and then 58 advisors now
trained and a new class set to begin in september 2011. these are individuals who commit themselves to civilian capacity building and to a security transition in afghanistan. i want to thank nadia, wherever she is, for all the effort and work that continues to go into this. i want to thank pamela all, the provost of our academy. i like to thank jim shear from the pentagon and all the staff that comes with moda. and of course i want to thank the individuals who give of themselves to be part of this program. today moda has the potential to be a defense institution-building tool elsewhere beyond afghanistan. and so, i would now ask that you join me in acknowledging
and applauding firstly the moda advisors and their families wherever they are, would they stand and be recognized. [applause] >> jim sheer, the osd leadership and trainers, if you would stand and be recognized. [applause] the usip staff that worked so hard. pamela, nadia, anyone else from the institute working on moda and its related activities, would you please stand and be acknowledged. [applause] the nato training mission in afghanistan, ccl, and a
member of our board who is here, the president of national defense university, also the senior vice president at ndu, ambassador nancy macldowney. would you stand along with the nato command folks and those working in the field and ndu, we want to thank those as well. [applause] so, where do we go from here? i want to welcome the advisors back home who have been deployed for one year. thank those that who have renewed their tour for another year and recognize them for their service. now prior to all of us gathering today the advisors and some via teleconference, video teleconference from kabul, afghanistan, had a
meeting, a very productive meeting with the key moda stakeholders as well as a group of u.s. government agencies who deploy their own advisers in afghanistan. there are other agencies of the u.s. government that also go and partner with agencies in afghanistan and we certainly acknowledge all the agencies who participate in such training. so what is the hope of today's conference? i would boil it down to four key objectives. one, we are here today to honor the achievements of the moda program's inaugural class. we are here secondly to learn from their experiences. third, to build a community of interest focused on strategic advising. and lastly, to attract potential moda program
advisors so that this will grow and expand and make an enormous difference. so i what i would like to do right now is play a short video for but the moda program which i think will give folks watching a sense of really what it does and what it achieves. if we could play the video. >> welcome back. it is called moda, short for ministry of defense advisors program. the department of defense is looking for a few good men and women to volunteer for a 1-year deployment to afghanistan and the commanding general there, david petraeus, thinks the program is already making a difference. marine sergeant ashley bryant takes a look into this new program of the civilian expeditionary workforce. >> the final two weeks of the seven-week moda training cycle mirrors the predeployment military
training units get. >> the facilities here are really world class and in many ways simulate truly the environment that advisors are going to experience on the ground. >> ultimately most of these civilians will spend most of their time not in the field but in offices, helping the afghans modernize and professionalize their defense institutions. >> we've got about 700,000 civilian personnel full time in the department. about 150,000 of them are senior, above the gs-13 level. and it's a terrific talent pool to draw from. >> felt it was important that if you were going to advise the civilian sector of their defense ministry you should have civilians who perform a similar function in the u.s. to do that advising. >> you can have an army but it actually takes some sort of government entity or
ministry making sure it is provided for over the long haul. make sure you have budget. make sure you have things planned out. make sure there is infrastructure to support a long-standing army. >> and then -- >> the first five weeks of the training are held outside washington, d.c. intensive language workshops like this one plus academic presentations and lectures by military, diplomatic and political figures. the volunteers come here to saturate themselves in afghanistan. students like miley parker are already experienced professionals in their own fields. >> we're the bureaucracy of the united states government here and so what we can do is provide technical experience that is current and practical and provide any sort of mentorship and advising services to the afghan government. i will be a senior acquisition advisor to the ministry of interior. so i will be working with
them on their contracting programs and program management programs. >> i will take on a position of information management advisor within the ministry of defense. >> the volunteers have a variety of motivations. >> fortunately you have no prior military experience. i didn't have that opportunity to deploy in the past. so as a leader it made sense for me to say, well it is really my turn. i can't really justify asking young men and women to go into the deployment situation when i myself have not engaged in that. >> maile parker comes from a military family and worked overseas frequently as a civilian. >> dod civilians have the opportunity to serve alongside our military brothers and sisters in the war zone and we're willing and able to perform that service. >> eric lud lump came into government service shortly before the 9/11 attacks. >> i see this as a generational challenge. this is one small thing that i can do to be part of that
generational struggle in support of my country. >> the volunteers are committed to a one-year deployment after training and can extend for a second year if they choose. up to 100 more may be needed. reporting from the pentagon, i'm marine sergeant ashley bryant. >> you can get more information about the moda program online. just go to defense.gov and type moda into the search window. ♪ . >> welcome back. >> welcome back. it's not often that i get to introduce and acknowledge two presidents in one day but i'd like to acknowledge the presence here today of the president of the united states institute of peace, richard solomon in the back. thank you. [applause] and now bear with me while i
do an introduction of another president, the president of national defense university. i have longed to give this introduction and today is my day because i get to introduce someone who is not just president of ndu, not just a vice admiral, not just a director of the board of directors of usip, not just a doctor, ph.d, you can call her dr. admiral. not just a pilot of private aircraft. if you're not leaning forward in your seat now, wait until i get to the next paragraph. someone who has been involved in anti-submarine warfare, and operations and operations intelligence, maritime transportation, and sea lift, strategy and policy, training and education, business enterprise and installations.
ann rondeau is a major force to be reckoned with. a leader in defense policy and an academic thought leader on war and peace. a expert in theology of conflict, political science and history of it. a practitioner and wonderful human being. would you join me in welcoming, admiral rondeau. [applause] >> well, my goodness, gracious, with that kind of introduction. let me tell you first of all how much it is a privilege and a pleasure to be in front of citizens of america who have decided to serve in a way that you have. so i stand here as a president of national defense university. i stand here as someone wearing the cloth of a nation saying thank you,
thank you to the civilian partners and counterparts and teammates who actually are forging a new way ahead in how the united states looks at conflict around the world. the fact that we at national defense university and the center for complex operations can be in support of united states institute of peace is one of the great honors that we have. it's also one of the great starts and one of the great symbols of the great initiatives. to what frankly will mark america for the rest of our time i think as a country. we used to talk about all manner of things that the department of defense should and should not do. today, we're talking about the department of defense and what we can do and must do. so we have come actually as a nation to something very different of ourselves. that is to think of
ourselves truly as a whole nation. to think of ourselves as department of defense team in support of conflict resolution and peace. after world war ii we had of course famously the marshal plan that was intended to rebuild europe. the world today is different. whether structures of formal organizations are important but the impetus of human beings as individuals is key. we do this through the information age and we do it now through what we have as the individual volunteers saying count me, i matter, i am, and i might serve. the united states institute of peace practices that in the notion that every individual matters to the conflict, to the resolution of conflict and to the making of peace. we in the department of defense think about it as a
resolution from the conflict. . . >> financial systems that do not support, if you have medical systems that are nonexistent, if you have agricultural systems that don't work, if you have crops but no roads, and if you have roads but no crops, if you have people but no education, if you have youth who do not have an aspiration for something better than what they are, then
you will have war and conflict. and we in the department of defense understand that. so we have an opportunity and a privilege in partnership with usip to think about this differently. we have the opportunity to think about the fact that we here matter and that it is to be resolved that we can make a difference. and so you'll hear stories and we know stories about the individuals who say, you know, i'm frustrated today, but yesterday was good and tomorrow will be better. and those individual stories about what the afghans teach us. and that is this, that no matter if we have marshal plans, in the end, relationships are what truly matter. so we learn that in tribal civilization of afghanistan much as we learn it in philadelphia, new york, los angeles, seattle, dallas or florida rm -- is that
it matters that we are trusted, it matters that we listen, it matters that we're willing to contribute and to be part of a team that makes things happen. so we will hear from mr. lumpkin about how that matters to department of defense and to the nation, and i say this: if not us, who? if not now, when? and if not be this kind of new approach that truly accentuates what the american values are, that individuals matter, that individuals have dignity, that individuals can make a difference, and if moda team shows that, the min city of defense advisers -- ministry of defense advisers shows that individuals matter. and whether or not we wear the cloth of the nation or the mantle of the nation as our civilian force, that we are a force for good. and that is our moral obligation
as department of defense. it is what makes us as a nation great, is that we in the department of defense can say what makes people hungry, what makes people yearning for something better, and how can we make a difference toward a better world? so we at national defense university, we are proud, we're pleased, we're honored at this, at this mission in support of the core mission of usip to find the reasons why we can help conflict become the cause for solutions and not the cause for war. and so we consider this partnership important. it is, it is unique, and it is our privilege and our pleasure. and i thank you very much for this honor, but i thank you for what you're doing every day to make the world a brighter place. thank you. [applause]
>> thank you, admiral, for very powerful and inspiring words. so now it's time to actually meet one of these moda advisers that we've been talking about, so i'm pleased to introduce david clifton, a former moda adviser, deputy director the facilities division, installation and logistics department at the u.s. marine corps. i should tell you that david clifton has served the marine corps for 38 years, including 29 years active duty. as a colonel of marines active duty assignments including artillery officer, maintenance management officer, coordinator of matters with congress, coordinator of the review process in the program analysis and evaluation department, battalion commander and installation commander,
comptroller, so many things. i am pleased to introduce a moda form beer adviser -- former adviser, david r. clifton. [applause] >> i think it's difficult to stand here as the one person representing the 17 plank holders of moda and the other 41 advisers that have already gone over there, so what my role is, is to try to tell a story from the adviser's perspective. you are going to hear more about the program, you have a really good description. if you haven't picked this up, it's around, i highly recommend it. it'll tell you about the program. so what i want to do is spend about 10 or 15 minutes of talking to you as a story of how that works out in a person's life.
and most of it's going to be my own experience which is humble compared to the other advisers, mostly who did a lot more than i did in afghanistan, but to just tell the story and weave into how the program works from a individual perspective. in december 2009 i was working in navy annex which is a building on the hill across from arlington cemetery where the air force memorial is, and an e-mail came across my desk that said we're looking for people to go to afghanistan, being a civiller servant and almost 60 years old, i was pretty sure that didn't pertain to me, but then i read the e-mail, and it said these are the kind of skills that we're looking for. and i realized that it was me. so i went ahead and filed the e-mail away, and a couple days later for some reason it was still there, and i looked at it, and i think admiral rondeau said it best, the thought occurred to me if not me, who?
so i went home that night, and i told my wife, and i was thinking, she's probably going to object. [laughter] and so, i don't know if i would have been happy about that or not. i would say ambivalent would be the right word. but she was totally supportive. and so then the next day i came in, and i said my boss is probably not going to let me go. and i sent him the e-mail that came out and described the program, what we'd be trying to do which made sense, and i said, i'd like to apply for this. and he said, yes. so i sent my application in the, i didn't hear anything for a long time. and in april i made a call to the program office, and i said i sent this application in, um, i was pretty sure i didn't get selected, but i just wanted to hear what had happened. and they said, oh, your interview's tomorrow. [laughter] so i got interviewed from afghanistan, and i found out that even though i was applying to be a ministry of defense adviser, that i was being interviewed for a job in the
ministry of interior. and i thought, i don't know anything about national parks or forestry. [laughter] and so during the conversation i found out that in afghanistan the ministry of interior was about police, and my original question was pretty good. i didn't know anything about police either. but they interviewed me because what they were really looking for is professional senior, experienced civilians who knew their business. that was the primary thing that i was supposed to bring. we have u.s. army colonels that are over there advising in these areas of ministry who may not understand the intricacies of accounting or budget or internal controls or procurement, etc., etc. that was what they needed me to do. and so they interviewed me, and the next day i got an e-mail from frieda guess who's out here, and she said, you've been hired. you're being offered a job. and then about five minutes
later, she sent me another e-mail that said, and, oh, we're going on the advance party next week. so we're going to go for ten days to afghanistan, we want you to go. i was -- mainly because i was the senior civilian, i think, more than anything else. and so in the middle of april i wasn't sure, i was pretty convinced that i had been not selected. by the 21st of april, i was in afghanistan. and we spent two weeks exploring the lay of the land because we were the plank holder group, the first group of civilians to go over there. and so it was a little confusing to people, um, the difference between contractors and civilians and exactly what our role would be to fit in as functional experts, and also we wanted to be able to come back and optimize the training. as soon as we got back, training started. it's about seven weeks, and that training is laid out pretty well
in the guidebook. it was very good training. ambassador dobbins, i think, is the most important person that i became aware of during this training, and he had posited that we keep fighting these reconstruction wars as if it's the last time we're ever going to have to do that, and that really sank in if with me. so i got all four of his books, or three. the main one being "beginner's guide to nation building." and i realized that this moda program, i really started out because of what the admiral said, if not me, who, but then i realized this is really a program that makes sense. what they were doing in the defense department was trying to accumulate the body of knowledge to go in and help the ministry learn how to sustain the forces that we would be generating. and that, that was just so logical to me. and i knew a little bit about
history. guys my age remember vietnam and, you know, we've read about things before that. and i know that we would be successful if building the forces -- in building the forces in afghanistan, in helping the afghans build sufficient police numbers and helping the afghans build sufficient army, but i wasn't sure if we would be successful in helping the afghans build the capability to sustain that on their own. and so that's what moda was doing, collecting the body of knowledge and systematically training people to go over and do that work over a period of seven weeks. once we were done, we went over, basically, through the military flow system which is an experience for civilians. um, the first ten days and, again, i'm mixing a little bit with what my experience was and what is happening now. the first ten days in the afghanistan now, and i'm speaking also from the police
perspective because i was in an orientation period where you go in, and you are given a period of time to read into your job, to get the intel presentations and get a basic grounding, get on the local time zone which is not that easy. and then, and you get some more training. the coin training is given over there. and then you start on the job. and the way that that process works is, hopefully, the person that you're replacing is still there. or if not, there's a designated person who takes you around and introduces you to your counterpart and the staff that's within your counterpart's organization. and then you're still spending some time within that first period getting your orientation and assessing what it is that is, is your sphere of advising.
and i left one step out, and that is that when you're selected, you also get read-ahead material that includes an advisory guidebook. and that's available out there. and so you're being able to during this initial period apply what's in the guidebook and what you've been taught, and you're seeing what it is on the ground. and one of the things we quickly realized in the moda program is that the training is very good preparation for what we're doing. the basic job of the advisers, and my job wound up being different when i got over there than what i was hired for. i was a chief adviser to the ministry of the interior, and my job was to coordinate and synchronize the effort of about 350 advisers from multiple countries, military, civilian and contract. and so the job changed. l but the basic purpose for the advisers in the ministry of interior is to move the afghans steadily towards self-reliance.
one of the litmus tests i always used to determine whether it was a good afghan leader or not was did they want us to go home? and if they did, that meant they were good leaders because they would be learning as fast as they could to run their own institutions so we would be out of there. the approach that we use is a very well-documented process, and the army and the interior basically had the same construct. for each of about 26 on the police and about 33 functions on the army, there was a plan developed that defined progress at four stages. it was like teaching people to fliment -- fly is a good analogy although it was much more complex in some respects. and in the first stage of development the plan was that we would be showing them how to do it. we'd be doing the activity, whatever it was; budgeting, procurement, accounting.
we'd be doing that for them. and in the next stage, the second stage, it was called capability milestone three, we would be still doing it, but they would be watching. so the first stage was like ground school, the afghans are not in the airplane. and in the second stage the afghans were in the cockpit but not on the controls. they were being trained, they were being hired, and we were still doing a lot of the work. in the next stage, each of these plans define what needs the happen for the afghans to be in control of the aircraft. pilot instructor's still in the cockpit, and under certain circumstances, takes control of the airplane. and there's a constant tension between when that's appropriate and when it's not. and in the final stage which is we're getting very close to that in many of these functions right now in both the army and the ministry of interior, and that is where you move into a stage of solo.
and the coalition's responsibility is high-level oversight and a much thinned presence. so the purpose of the advisers is to execute these plans over four phases and make the afghans self-reliant. and we are making progress against those in afghanistan. it's my view that the civilians will have a very key role in making this happen, that it was a very wise choice on the part of the defense department to take this approach. it's very strategic, it will be effective, and it's not that experiencive. -- expensive. and so what you have is a giant effort to generate forces, and now we have invested in the way that ambassador dobbins had suggested almost exactly to train people to go over and work at the ministry level to teach
these basic what i will call business processes so that the forces can be generatessed when we are gone. and one of the key aspects to that is understanding what the right level is, and each plan is supposed to define the end state and what that looks like. and if it's -- from my perspective, i looked at all 26 plans, i met with the afghan general and the adviser to see how is it going, i would challenge them towards the end state that was defined. and if it was a western solution, i was pretty convinced that the the wrong one because it needed to be. there's an expression, there's several expressions. one was do no harm, another was afghan good enough which was in no means at all derogatory. it just was meant to say think carefully about what's the minimum requirement necessary for the afghans to be able to run this function on their own in their own way. which is often very different
than ours. and they, in some cases, require lack of 24/7 power just as an example. we'd be sitting, you could sit in the ministry of interior, and the power would go off frequently. of course, being in the marine corps as long as i have, i was used to that. but still, it impacts the solutions that you want to deliver over there. um, so in summary, i would say from my own perspective and the experience that i had over there which started about 14 months ago that the moda program has provided the knowledge, created the conditions for success on the part of the advisers. they have a systematic training program that i wish all the military that came over would go through. they provide reachback so that when i had issues and i needed help, that i could call back and get that kind of reinforcement, and that worked for me on a
couple of occasions. we were providing civilian expertise, and to me one of the interesting thicks is -- things is, and i did the interviews when i was over there. i interviewed. and it was very interesting to me to hear these accountants and internal control specialists and is acquisition specialists talk about their passion for coming to afghanistan. i was used to that in the marines, but it just struck me that we had this, um, civilian reservoir of commitment. and they are making a difference, which you will hear right after i get through, which'll be soonment -- soon. um, so i think that the moda program is something that is long time needed. i think it's progressed very rapidly, and i think it's fulfilling a very important mission. it's an opportunity for civilians who might want to
serve to have a chance to do that and to make a difference. coming back after 14 months i'll say again, i think we're on the verge of success. i think the ministry adviser program over the next two or three years, in my view, is the center of gravity. if we can make that work, if we can keep reinforcing the trained advisers that are there for no less than 12 months and possibly longer -- which moda enables -- then i think we'll have the ability to succeed. and what will success look like? i've been asked many times, it won't be pretty or perfect. and it might not be immediately evident. but i think that we're on the verge in the investment more important than any to keep reinforcing is these ministerial advisers and the civilians that general petraeus and general caldwell have asked for. and then my final sing is i would like to thank -- my final
thing is i would like to thank kelly uribe. would you stand up, please, kelly? [applause] thank you. kelly is the program manager who's a part-time mom, well, she was a part-time -- [laughter] she's a full-time mom, and she was a part-time dod civilian when this thing started, and then she became a full-time mom and a full-time dod civilian. and if anyone has made my comments positive or the outcome to be encouraging, i think it has to be her. there's a lot of other people that have already been recognized, and i don't want to take time to go over that again, but i did want to point out and single out kelly for what she's done and made a big difference in this program. it's been a very singular effort, and i hope she gets greatly rewarded. [applause]
>> thank you, david. we're now going to go to kabul. it seems like an appropriate moment to take you to afghanistan to hear a recorded message, um, from commander of nato training mission in afghanistan, lieutenant general william b. caldwell, who is also commander of the combined security transition command there and was the spokesperson for operation iraqi freedom years ago. he's really been major supporter and contributor to this program, to its manuals and its projects, and we feel very fortunate to be able to share the videotaped message with you. if we could roll tape. >> it's great to be with you to celebrate the one-year anniversary of the moda program. when nato training mission for afghanistan was stood up in 2009, we saw our mission was to
build an enduring and self-sustaining afghan national security force. though the international community had been supporting the afghan government and military police for several years, efforts really lacked from a sense of unity, there were limited resources and even limited expertise. with the lessons of the soviet experience and previous international efforts as our guide, we adopted a new mindset that arrives on teaming, transparency and transition. today we see progress and promise for the future, and one of the most important contributors to this achievement is the moda program. the moda program has been the key enabler for us to not only achieve progress in the training mission, but has been an absolute game changer. it's what has enabled us to really help professionally develop the afghan ministries of defense and interior. we continue to grow and develop the afghan army, air force and police, the force is on track to
reach its 2011 milestone and will grow another 47,000 over the next year. part of this growth insures the force develops key support forces such as logistics and human resources and finance. professionalizing the force is key to creating enduring institutions. there is a substantial effort to develop sustainable systems and functioning ministries that can plan, program, budget and execute ministerial goals. in support of this effort, there are about 500 ntma advisers who wake up every day and go to work in the ministry of defense and interior. these advisers support their afghan counterparts to insure the necessary policies and systems are in place to implement strategic guidance from the president of afghanistan to the anyonesters -- to the ministers. this includes everything from creating a modern personnel system that can identify, track and manage people across the military and police to a comprehensive recruit screening
process that literally vets, validates and certifies afghans eligible for training. throughout its first year, moda's support to ntma has been critical. moda enables transition from what was a military-centric senior advisers to civilian senior advisers, a key and necessary step to professionalize the civilian work force both in the ministry of interior and defense. to date, we have literally been thrill with the the moda advisers here in kabul. for example, chris hart used his unique skills and expertise in the defense commissary agency to assist in the development of a new ministry of defense slaughterhouse operation which increased production and improved food safety, and we affectionately call him the slaughterhouse dude. [laughter] then there's kimberly eckel who took on the broader responsibilities for organizing the afghan automation, integration and education
working group. and at night she leads zumba classes. i can tell you, their singular contributions have had an incredible and lasting impact across the afghan national security force. and there are countless other modas with similar stories who are making a dramatic difference every day. the personnel have the experiences that can't be replicated by us in the uniform or by contractors, and that's important as transition progresses over these next several years. moda is making a difference, and each of you has played an enormous part in that effort. from each and every one of us serving here in afghanistan, we want to congratulate the moda program on its one-year anniversary, and we look forward to welcoming future ministerial advisers to our team. >> it is now my pleasure to call
to the podium michael lumpkin, acting assistant secretary of defense for special operations and low-intensity conflict. um, mr. lumpkin has more than 20 years of active duty military service as a u.s. navy seal where he held every leadership position from platoon commander to team commanding officer and many other experiences in iraq and beyond. it's really a great pleasure to turn the podium over to michael lumpkin. [applause] >> first off, it's an honor to be here to celebrate the first anniversary of the ministry of defense advisers program with you. and, also, to say thank you for each of the advisers, for the sacrifices they've made from the
past year and for the accomplishments you have achieved together with your afghan counterparts. the strong partnerships forged by the moda program advisers are a small but vital part of the overall effort to insure a successful security transition in afghanistan. this afternoon i want to do four things. i want to review our progress in the afghanistan, highlight the role of the moda program, i want to look at some of the challenges that are facing the program today and encourage each of you to participate in this exciting endeavor that is making the lasting contribution in afghanistan. as you know, president obama announced on june 22nd that the united states would begin a deliberate, responsible drawdown of our surge forces from afghanistan. the drawdown began on schedule with last month's redeployment of two army national guard
battalions. the drawdown will include a total of 10,000 troops over the course of this year with another 23,000 coming home by the end of summer of 2012. the united states' objectives in afghanistan remain unchanged. our goal is to deny safe havens to al-qaeda and to deny the insurgents the ability to overthrow the afghan government. clearly, the operation against osama bin laden was a great step towards achievement anding these aims. -- towards achieving these aims, but coalition forces must continue working together to degrade the taliban-led insurgency in their strongholds and to provide time and space for the afghan national security forces and the afghan government to assume the lead for afghan security nationwide by the end of 2014. the key to this responsibility,
to this responsible afghan-led transition, is the presence of a capability of a 300,000-member-strong and growing afghan national security forces. and the development of civilian-led security ministries that can sustain these forces. as secretary panetta confirmed during his visit in afghanistan in if july, these forces are growing in the both size and capability. the afghan national army and the afghan national police are steadily improving and gaining capability to provide security for their own people. ansf has grown by more than 100,000 troops, and the police officers since president obama first announced this strategy in december of 2009. and by the end of december of 2012 when the last of our surge forces are out, another 50,000 afghans will have joined their national army and police force.
as a result of this expansion, there will be, actually, more afghan national security forces and coalition forces in the fight than there are today. and substantially more of these forces will be afghan. indeed, by the time -- this time next year for every american soldier in the afghanistan, there will be five ansf soldiers and policemen in the fight. we recently witnessed a tangible sign of this progress when leaders from both the afghan ministries of defense and interior worked closely with isaf to orchestrate a shift from coalition to afghan-led security in seven geographic areas within the country. we're also in negotiations with afghanistan on a strategic partnership that will frame the character of our enduring relationship. it will send a clear and reassuring signal to the region
that afghanistan will not be abandoned and that the united states remains committed to regional peace and stability. as president obama said, we are determined to see this partnership become a reality so that in the future afghanistan is a safe, stable, peaceful ask ask -- and secure. i want to emphasize that although progress in afghanistan is substantial and that our strategy is on track, significant challenges remain. we have dislodged insurgents from key strongholds in the south, and we have improved security throughout much of the north, and capital regions. however, we have much work left to do in the east where the physical terrain, the culture, the geography and the existence of safe havens in the pakistan represent a complex set of challenges distinct from those in the rest of the country.
in addition, only after afghanistan's security institutions are self-sufficient and self-sustaining will it be possible for the afghan government to solidify the tactical gains earned at such a great cost. and that's where the relatively small ministry of defense advisers program comes in. this select cadre of civilian experts is assisting the afghans who will lead afghanistan's key security institutions long after the fighting ends. the first team of 17 modas made such an immediate impact that general petraeus requested 100 more only six weeks after they arrived. there are currently 47 moda advisers in the kabul, so you'll still have a chance to join if you haven't. there's opportunities abound. classes deploy three times a year, in march, july and
november, so you can go ahead and just mark that in your calendar now. i hope you'll take the opportunity while you're here for those in the audience to meet some of the returning advisers during the reception after this event. moda advisers come from a pool of seasoned professionals with, on average, 23 years of experience. they represent more than two dozen dod organizations including all four services, the office of the secretary of defense, and they've passed the rigorous seven-week deployment training program that was outlined in the video. you heard some examples from lieutenant general caldwell, but i want to share a few more stories that demonstrate these unique civilian experts and the difference they're making on the ground in the afghanistan. moda advisers rick pawlett and justice landis helped develop and successfully field a logistics readiness tool that
provides commanders insight into equipment accountability and readiness in their districts. rick relied on the core principles from the moda training program; promote local ownership to help pilot this simple afghan-designed -- key, afghan-designed -- tracking tool that resulted in a 99.6 accountability in a recent audit. moda adviser mike cayman is helping the afghan ministry of defense and interior develop long-range plans to improve gender integration and human rights in the afghan national security forces. currently only .2% of the ansf are women. and moda advisers' efforts will increase this number significantly. and finally, cameron delancey, a licensed architect with washington headquarter service
assisted defense counterparts at the installations management director to improve professional engineering education through the university of kabul. all of these successes and a lot more like them rely on the strong, trust-based relationship built between each moda adviser and their afghan counterpart. each achievement, even the smallest ones, is a testament to the quality of the program's predeployment training which emphasizes developing sustainable and locally-owned solutions that respect humility -- that are based on respect, humility and empathy. i believe these accomplishments and the moda program's mission will become more important as the drawdown of u.s. and coalition forces continues. the program empowers afghans to lead and manage their own security ministries and will point the way to a self-sustaining afghan national security force after 2014. while limited in the scope right
now, this program's potential extends beyond the borders of afghanistan. strengthening foreign defense institutions is an increasingly critical element of our overseas engagement, and through inexpensive programs like moda, we can help partners build effective, accountable and well-governed defense ministries. in reality, the benefits to our own civilian work force may prove even greater. when moda program advisers return to their department of defense positions here in the united states, they bring back new skills, knowledge and experiences. in addition, their close professional ties with foreign counterparts may help solidify future strategic partnerships between our nations. for those who have participated in this program, it is an experience that you can with proud of for the rest of your life. you will know that you made a
very real impact at this strategic juncture in our nation's history. for those of you in the audience who will soon deply, i want to share -- deploy, i want to share a short excerpt of an e-mail written by one of the current moda advisers, a u.s. navy rocket scientist -- yes, a rocket scientist -- but this is a testament of the caliber of the people who are participating in this program. she is now involved in the ansf gender integration effort. her e-mail gives a kind of a sense of what it's like to be an adviser. char writes: although some days here are long, tiring or discouraging, others are equally uplifting, exhilarating and encouraging. i approach each day with passion, and they have all been worthwhile. she continues: when i start to question why i'm here or if this is even feasible, i just remember what the afghans tell
me. an afghan major general told me that having people against you is no reason for not doing something that is right. an afghan senior civil servant told me that if i thought integrating women in the army was tough now, i should have been here during taliban rule. [laughter] when she was running underground schools for girls. she thinks this is easy. einstein was right, it's all relative, and we modas are making a difference every day. while these achievements and sentiments are real, i want you to understand that the program's limitations and challenges, too, because right now they are real as well. after all, this program has only completed a single year in practice. it's still in its infancy. and like many new ventures, it has encountered some setbacks, and we've identified opportunity for improvement.
as we enter year two, i want the moda program to be a true learning organization, seamlessly adapting and adjusting to the new requirements and lessons learned. and i know a lot of that happened here today. one reality is that we came to the table late. we should have established something like moda years ago. and, frankly, not just in afghanistan, but also in iraq. our military and contract work in both nations would have been greatly enhanced if we had a civilian program like this in place from the very beginning. that's why we need to institutionalize this capability so that in the future we can be on the ground in year one. we have learned much about building stronger civilian, military and interagency command and control structures in place like southcom m&a fri -- and
africom. personnel management is another challenge. we've had some problems reintegrating moda volunteers back into the home organizations in ways that leverage their experience to the benefit of the department. this needs to be fixed. dod components must recognize moda and be other civilian deployments as an enormously worthwhile stage in an employee's career. we need to insure that civilians who deploy are properly rewarded for that experience and are welcomed back into their organizations with appropriate after care. i know that to some degree this is going to require some cultural change, making dod civilians more expeditionary. it means encouraging more dod personnel to undertake overseas missions, helping managers reorganize and value these deployments and better, to better meet the needs of the people who undertake them. as you can see by the diverse group of speakers this afternoon
and throughout the day, the moda program in afghanistan has developed and has been executed by a team of teams. they deserve special recognition for their collaborative efforts to turn this good idea into a reality that gives us the ability to celebrate the one anniversary today. first and foremost, the program would not be possible without the advisers and the support from their families. these people willingingly volunteered and sacrificed for this important mission. of the inaugural class of 17 advisers, eight volunteered to stay for a second year in afghanistan. a special thanks goes out to the u.s. institute of peace for hosting this important event and continuing to support moda training. with its lead instructors and course content. as tara noted earlier, the development of this unique myrrh too early advising training
program actually began during a small meeting hosted at usip in 2009. usip's expert on ministerial advising, nadia, deserves special recognition for her role in developing the four core principles at the heart of this training program. the center for complex operations was another key participant in that 2009 meeting. the center's staff penned the course learning objectives and the implementation plan. the cco continues to play a vital role in moda in its outreach and recruitment through its portal on prism. i also want to thank the office of secretary of defense for personnel and readiness who worked tirelessly to develop and manage and execute moda's current training course. this groundbreaking training program led by pnr's director of strategy, frank, continues -- or they call him d9 -- continues to
receive broad accolades and fill the defense-wide gap in advisory training. without frank, numerous afghan role players simply wouldn't exist today. in addition, pnr's entire civilian expeditionary work force team made the advisers' deployment program possible, and they continue to offer day-to-day support for our deployed advisers. the moda's program success is tangible sign of how viable the civilian expeditionary work force model can be, and i look forward to continuing a close partnership as we expand this program. lieutenant general caldwell remains a steadfast advocate for the moda program, and his staff supports the program at every stage of the advisory effort from requirement developments, adviser selection and support to advisers during their tour in
afghanistan. finally, we need to applaud the afghan people. they work tirelessly in these afghan ministries every day building from the ground up. they are the future of afghanistan and are the center of the moda program. their resilience and tenacity despite numerous obstacles will insure successful transition and a bright future for afghanistan. while my participation here as delayed the -- has delayed the reception slightly, i would like to bring my comments to a close. i hope today, um, has persuaded some of you to join the moda program for those who aren't already involved. whether as an adviser, a training partner, a reachback resource or even a recruitment volunteer. the moda team of teams needs your help, and you can be part of this his historic, pragmatic
initiative in a variety of ways. the program and the equipment providers are outside, i encourage you to take one, and kelly uribe, who was recognized earlier, and her team will be able to answer questions for those during the reception. bear in mind that the application deadline for the march class is september 1st which is just three weeks away, so we're still taking applications. so i want to thank you all very much for your participation and everything that you do to support the moda program. thank you. [applause] >> well, we have just a couple of, um, last items to do before releasing those of you who are here to the reception, those of you who are at home to your kitchens. we cannot get you in the reception, but we are glad that you were watching today. um, there are people here with orange stickers, and that
enables you to find out more about all of this or request media interviews with them. i won't go through all of the press people who are here, but if you do want a follow-up interview, please, see me or somebody with an orange sticker on their badge. to close out, i do want to recognize the returning advisers from this first year; harold graziano, scott lewis, wesley lewis. those extending their terms, cameron delancey, kimberly, quentin gilmore, christopher hart, alan johnson, rashid diallo, and as a final closer i would like to ask the moda advisers that are with us today, um, and one spouse of mark jones wherever you are, i think you're there, deserve a special recognition. [laughter] i would like to ask the following advisers to stand and
then lead us out to the reception and join me in a round of applause, please, for the returning advisers; david clifton, george dryden, john hawk, charles heiden, mark jones and be mrs. mark jones, and then extending, teresa sorenson, who's here. if you would join in a round of applause, and they will lead you to food and drink. thank you very much. [applause] [inaudible conversations] [inaudible conversations]
[inaudible conversations] >> and tonight on "the communicators," we'll hear about legislative proposals in congress for addressing the issue of cybersecurity. our guests include texas representative mac thornberry, chairman of the republican task force on cybersecurity. and rhode island democratic congressman jim langevin who co-founded the first-ever house cybersecurity caucus in 2008. "the communicators" airs monday nights at 8 eastern here on c-span2. and all this month watch booktv in prime time on c-span2. tonight politics and the american novelist. at 8:30 p.m. eastern, robert hearst on his work, the autobiography of mark twain,
volume i. at 11:15 harriet risen's louisa may alcott, the woman behind "little women." booktv in prime time all this month on c-span2. and a live look, now, at the national press club where coming up at the top of the hour we'll have live for you the 60-plus association who will host a discussion on social security. we'll hear from several economists from the obama and former bush administrations about ways to reform the program and the politics surrounding the issue in the runup to the 2012 elections. a live event that's going to start, scheduled to start at the top of the hour. and while we wait, here's a look at some of today's "washington journal." in "usa today" this morning, one
of the headlines emblematic of this day for the president. richard wolf writes -- to tell us more about the president's trip, jeff mason from reuters joins us he >> host: jeff, welcome to the program. correspondent. welcome to the program. guest: thanks very much. host: what does the president hope to accomplish with this trip? guest: well, i think there are a lot of things on the list. one is just really getting out
of washington after a very divisive debate over the debt and deficits, to get out and talk to people in the heartland, as it were, to try to reconnect with the voters and to show, especially after the republican campaign has heated up, that he is in the game as well. host: some of the places he will be going includes cannon falls, minnesota, two stops in iowa and two stops and atkinson, an illinois, and alfa, illinois. how were they chosen? guest: i can't tell you exactly but i think it is interesting to note that iowa, for one, is a state where republicans have just been competing for positioning in the straw poll that happened over the weekend. these are important states in the midwest that he will want and need to win when he runs for reelection in 2012. the white house is not describing this as a political trip. but it is a bus tour.
and bus tours by nature are political trips. again, it sort of ties into the idea of getting out there into the middle of america and reconnecting with voters. that is very much what would have gone into the criteria. host: he has on his agenda several town hall meetings. these are going to be open to the general public, i presume? guest: yes. usually those types of things are open to the general public. depending on where they go, they often have to get tickets in advance and sometimes there aren't enough tickets to go round. but it is not the type of thing where audiences are chosen in the advance. host: will be be putting out any specific plans for job creation during this three-state trip? guest: it doesn't sound like it. he has been previewing the fact that he and his colleagues or staff at the white house will be putting out some job creation measures in the fall, probably as early as september. he said last week that he will
be putting out proposals week by week. what we are figuring out or learning is a those proposals will probably come at the end of this month or early september and not necessarily on this tour. you did mention earlier, referring to the "usa today" piece, that he will be gone on vacation in martha's vineyard. it is more likely the proposals will come after that. host: first, business before pleasure. it had nine and "usa today." jeff mason, white house correspondent for reuters. thank you very much. we are going to take your calls regarding the president's three- state bus tour. is this the road to economic or political recovery for the president and the obama administration? our first call comes from whitney, south carolina. james online for republicans. caller: thank you for the call. i think that it will benefit the
president because of naturally he will be in touch with the folks out there where he has got to be because those are the swing states. however, my only advice for him -- i am republican, so i am against -- against the president winning next year. but my advice would be is he should drop the rhetoric about blaming george bush. i say this in all sincerity. because i think the republicans are going to try to weigh that out or to refuse that -- reviewed -- rebut that. when congress in a wave of election to thousand six went for the democrats in the house and senate, then bush had sent messages over them to try to get all of this out. plus, the unemployment up until then, was not a factor in this country. it bush, through his first six
years in office, unemployment never did go to 7%. even though he 70 -- spend a lot of money on wars and step, he did not outspend barack obama. so, the blame the bush thing, even though a lot of the propaganda went down, i think the republicans can refute that. he needs to lead george bush out of his rhetoric. host: we will move on to evergreen, alabama, on our line for democrats. you are on "washington journal." is that macarthur? go ahead, sir. caller: i would just like the current delay -- congratulate the president tried to bring the clergy together and stuff. but what he needs to do is crackdown on all of these people who defraud medicare, over charge people for medical stuff and they are not doing nothing for the people. they have people coming back and forth to the doctor.
doing nothing but taking the medicare money. something needs to be done. thank you and have a good day. host: let's move to madisonville, kentucky, on our line for republicans. i need for you to turn down your television. i am hearing some feedback. caller: all right. all i got to say this morning is, why everybody want to fight and argue over the deficit? why can't we all just kind of gets along and try to do what is right? you know, trying to get more jobs and everything. can't we just lowered the revenue just and little bit? host: what do you think about the president's bus tour? do you think it is a way for him to get his economic policies back on track, or is it something -- is this a political trip?
caller: it is probably going to be a political trip. obama is doing all right, in my opinion. he just needs to look at the johns and tried to think about -- in no, don't need to know more stimulus package. they don't do much. all these people that own companies, they have all the money. i am working man. i never did see none of it. host: as a republican, are you going to vote for him in 2012? caller: if he turns around -- if he can turn around and >> and we will leave this portion of this morning's "washington journal" to go live now to the 6 $60 -- 60-plus association. we'll hear from douglas holtz-eakin and jared bernstein. it's just beginning, let's listen in. >> i believe you're in for a
treat, but before i turn to the most distinguished panel i believe we have ever assembled, allow me to take -- make a couple of observations. i say this as i enter my 50th year here in washington coming here in 1962 as a young reporter covering congress, working in this very building, the national press club. social security was 76 years old sunday, august 14th. ..
while the system needs reform, seniors are entitled to solutions, not political potshots. after all the system started as a 2% tax on $3000 in income has grown to 12.4% tax on as much as $106,800. from $60 annually, that is only $5 a month, yes i did the calculation on the computer -- are to be sure i also did the math with an old-fashioned pencil as a reform -- former reporter and believe it or not $5 a month back in 1935 is now as much as $13,000 annually. that is a whopping $1100 change per month. so why isn't it a goldmine for seniors? two reasons. actually, three. number one and lower rates of earth mean fewer workers paying in. number two, living longer. yes, we are come into our 70s,
80s, 90s and beyond. as one observer put it rather delicately i thought, seniors no longer quote conveniently die unquote at the actuarial age of 65. or 60-plus honorary former congressman rogers ion now nearing 90, living with his wife marjorie in evansville indiana, roger eloquently states that he has been quote, statistically dead for 25 years. that puts a pretty big financial strain on the system. in fact the first recipient of a monthly check item a for is a perfect example of why the system is in some financial straits. she paid in less than $25 before retiring, but instead of conveniently dying at age 65, this retired schoolteacher live to 104 for investment of $25, she was paid nearly $23,000 in
social security. that is a whopping 92000% return on her investment. by the way incidentally, in cleveland ohio, ernest ackerman actually retired the day after the system became law. he paid in a nickel. he got one check back for 17 cents. that was a 340% return in his investment. number three and finally little discussed in congress is the social security trust fund. it is bulging with over $2.5 trillion surplus is paid in by current and future seniors. but one of washington's 30 little secrets -- the trust fund is the favorite cash cow of surprise surprise, congress. i like to quote democrats and republicans alike and i would say right here to former senators the late senator john heinz republican of pennsylvania and senator fritz hollings former senator hollings from south carolina held a press conference a few years ago and they said, if private businesses
did what we do here in congress stealing from this trust fund that they would be locked up for embezzlement. that is probably correct. enough about the system's problems. there are solutions galore offered by all manner of experts. i guarantee you that the two people we are privileged to have with us will offer a straightforward practical solutions. unfortunately social security solutions often run into a political was on capitol hill. you know nowadays signing pledges seems to be standard operating procedure in washington. perhaps we will need to present a pledge to be signed by congress that seniors will no longer be used as political ponds on capitol hill sewer firm can be accomplished. now to our distinguished panel. first of all jared bernstein is a senior fellow at the center on budget and policy priorities from 2009 to 2000 -- 2011. dr. bernstein served as chief
economist and economic adviser to vice president joe biden. he was also executive director of the white house task force on -- and a member of president obama said mommy team. prior to joining the obama administration dr. bernstein was a senior economist at the economic policy institute here in washington and during the administration of clinton he held the post of deputy chief economist at the u.s. department of labor. dr. bernstein is the author and co-author of numerous books which i will point out for popular and academic audiences. he has been published extensively in various venues, "the new york times," the post in the financial times and others. he is also a commentator for cnbc and msnbc and he anti-host the popular economics blog jerry bernstein blog.com. earns dean, dr. bernstein holds a ph.d. from columbia university. i give you jared bernstein. [applause]
>> thank you very much. it is. it is great to be here to talk about one of my favorite topics. jem, thanks for the nice introduction. i always like to find myself in the company of doug holtz-eakin. the story i like to tell about doug is that when he was the director of the congressional budget office, he annoyed everybody equally, and that is very important in this town so i give him a lot of credit. let me start with a set of principles. in fact i think of my talk to you today in three brief parts, principles, facts and fixes. principles, facts and fixes. first on principles, this is -- these are the set of principles and ideas that guide my thinking and i hope yours is well on social security. retirement security has to be a
gold of a civilized society and an advanced economy and in fact this is the case in every advanced economy. a guaranteed pension is essential to meeting that goal. private plans that depend on stock market returns can surely complement a basic guarantee but they are simply not compatible with the goal of retirement security. three, private employers are providing ever fewer defined-benefit plans, so if you think about the three legs of retirement security, pensions, savings and social security, to my thinking despite and i argue a little bit with some of the points jim made in the introduction, despite some of the points that you commonly here, i would argue social security is the strongest leg of the three-legged stool, not because it is so strong that it doesn't mean fixes. it does and i'm going to suggest some but it has the other two have weakened significantly,
pensions and savings. those are the principles. now here are a set of facts that guide my diagnosis of the problem and the prescriptions to help fix and maintain this venerable 76-year-old. average benefits, as jim pointed out, are not overly generous. right now the average benefit is $1200 a month, around 14,000 a year, but those benefits are very important to people, and i think this is commonly misunderstood. you just can't repeat these kinds of facts. maybe the folks in this room encircling on this panel know these facts, that the importance of benefits, even at their not so generous levels, can't be overestimated. for more than half of elderly beneficiaries, social security provides the majority of their income for a quarter. four a quarter it provides nearly all, about 90% of their
income. and of course as you guessed, given the spending down of your savings and diminished probability of working as you get older, as you become the older elderly, dependence on social security increases with age so among those aged 80 or older social security provides the majority of family income for about two-thirds of the beneficiaries and nearly all of the income for about one third. if you were to take social security out of the picture, poverty rates among the elderly would jump from 10% to 45%. %. it is a huge poverty reduction program. now, let me move on to some of the budgetary points. my first is that these benefits are critically important s when i get to fixes i'm going to emphasize -- i am not one of these don't put everything on the table people. i am not saying benefits are outside of the target.
i am just saying that when we think about achieving sustainability in social security we need to be mindful of the importance of those benefits to the beneficiaries. now let's talk about the budgetary challenge. when you hear folks talk about how entitlement spending is unsustainable which you hear a lot these days, make sure they are not including social security. it is absolutely true that entitlement spending is expected according to cbo estimates to increase from about 10% of gdp today to about 16% and 25 years. but, only 1% of that six percentage point increases in social security. that is not nothing, but it certainly should be split out from the pressure on entitlement spending coming from the health care side. that is where the real pressure is an impact and in fact if you look at the projections over
time, you will see in fact social security not only goes from about 4% of gdp to around 6% by about 2035, it's days about 6% while the health care entitlements continue to grow based on both demographic pressures, but more so cost pressures for health care costs. so, that said, along with his entitlement pressure you often hear we can't afford it. we simply can't afford to fix the social security shortfall. let me put it this way. the 75 year shortfall according to the actuaries most recent report amounts to about 8/10 of a percent of gdp. so according to the most recent actuarial report a tenth of a percent of gdp, the long-term shortfall over the 75 year actuarial horizon -- this is just about equal to the revenues that you would achieve from the
expiration of the high-end bush tax cuts, just the high-end bush tax cuts. so when people argue that we can't afford social security, yet somehow we can't afford those high-end tax cuts, i think that is a hypocritical and destructive argument. how is it that every advanced economy in the world, every other advanced economy in the world can afford this but we can't? what is so different about us? as we have demographic pressures but in fact if you look at the countries of europe, they are demographic pressures are even more challenging than ours. yet, we are an international laggard. 30 out of 42 countries if you look at replacement rates of median income across the oecd -- that is the organization to make such comparisons -- the oecd average for the replacement of pre-retirement median income is
about 60%. our social security replacement rate is about 40% by that metric. but isn't social security going broke? the trust fund exhaustion 2036. i think this has been a terrible misinformation campaign. some of the worst misinformation i have seen. it is absolutely the case that full benefits can be paid through 2036 at which point the trust fund is exhausted, which makes it sound like the benefits go to oh, but they don't. of course payments still are coming into the system and social security at that point would be able to pay 75% of scheduled benefits. now this again is widely known perhaps to people in this room but i guarantee most people think out there when they hear trust fund exhausted that is all she wrote. but we shouldn't let that happen. that 75%, i'm not saying that is an acceptable outcome. i think we should take steps to close the shortfall and i think the step should be a combination of tax increases and benefit
cuts because guess what? those are the only two options and you can dress it up anyway you like but at the end of the day that is what you are talking about. as you might've gotten for my part of the discussion on how important benefits are to social security recipients, what large share they are to the average retiree, that i would rank a benefit cut as considerably less desirable than revenue increases to sustain the program but i don't take them off the table. here are some ideas. as jim correctly pointed out there is a long menu and back the actuaries have done a good job at this. i think maybe 30 different options you could tap and i'm just going to name a few that are most commonly discussed in the debate. the first that i think is essential is to gradually increase the maximum amount of earnings on which workers and their employees -- employers pay social security taxes. as jim mentioned it is around
107,000 right now and it totally covers 90% of earnings. i think it is around 83 or 84% right now in terms of how much earnings are covered but historically it is covered 90% of earnings because earnings equality have run so quickly, that is there so much concentration of high level of earnings at the top of the scale bashir above that threshold, the share of earnings above that threshold has increased to about as i said, 16% instead of the traditional 10. get up there and you can close -- you can close maybe 40, 50 basis points, something like a two percentage point payroll gap. the chained consumer price income -- i probably don't have to describe it to this audience but it is basically a more accurate measure of prices so switching to that is on almost everyone's list including i believe the president brought that to the table.
that is a benefit cut. let's be very clear. i mean, sometimes newspaper reports kind of get that wrong. it is a technical thing but it is a benefit cut relative to promise payable benefits but i think it is a good idea. now you kind of get into some of the ones that are a little more tricky and controversial. trimming benefits to reflect rising life expectancy, rising retirement age or longevity indexing which i think is a mysterious way to say raising the retirement age so people don't know what you are talking about, that is obviously, to many people it is a very compelling idea and you heard jim busse very correct assessment of how we are all living longer and while that may be an accounting problem for social security i think it is a pretty good day and. but be aware of one thing and this is why i would put this low down on my list of fixes. the life expectancy and we only have these data for men retiring at age 65 has risen 60 years --
six years in the top half of the income scale but only one year in the bottom half. in other words, increased longevity has more and more become a function of income and men of lesser and calm are not living all that much longer than they did a generation ago. sir raising the eligibility age is not a slamdunk when you hear the statements made about how we are all living longer. in fact we are not all living longer. those in the top half are living longer and those at the bottom of the income scale aren't living longer. i want to get out of the way because i want to hear what god has to say, but there are other ideas. i would just like to leave, and we can talk more about those in the q&a if you would like. i just wanted to add one idea on the table a fix i hadn't heard discussed enough and i think partly because doug might like it and i'm interested in his response. this comes right out of the
domenici rivlin budget plan. you know employer health care benefits, the health care health care benefits that employees pay provide for their employees, are untaxed. those benefits are untaxed. in the domenici rivlin debt reduction plan, they came up with an idea that i think is interesting and has some appeal. economists like doug and i and i think i can say dug in here because we have complained about this from our various -- for a while tend to worry about the extent to which this employer tax exclusion on health benefits distorts the system and lots of different ways and noticed a large tax expenditure north of 100 billion. if you could apply the payroll tax to the value of employer-sponsored health insurance benefits, may be phased in over 10 years, that can really take some of the cost
pressure off of social security. in fact according to their analysis it reduces almost half of the 75 year gap that the actuary is testing out. so the idea would be that the growth of these fringe benefits, because of the increase in health care costs, the growth of employer fringe benefits has put pressure on costs in the health care system and has eroded the social security tax base because remember wages are taxed, non-wage benefits are not. so this takes the payroll tax and applies it to some of those non-wage benefits and egg gradual way. look, a sure applause line. i used to write speeches for politicians. america is the greatest country in the world. that is as it should be. patriotism run strong in our veins and mine and yours as well i'm sure but what do we really
mean by this? what is it that makes us such a great country? in my view it is no exaggeration to say it is ideas like social security, it is that ties together, ideas that by their natures provide security and respect for those who raised us and those who spend their lives helping to build our future. so those are the ideas that i think would help to fix and maintain this program well into the future. thank you. [applause] >> thank you very much doctors bernstein. let me make a comment on the high income in the low income seniors. clearly low income seniors suffer more during this heatwave we are having. why? because of the high cost of electricity. they can afford to turn on their air-conditioning, and that is a shame. more people die in heatwaves band to freezing weather.
one other observation on the social security trust fund. please explain that to me. i still can understand it. that trust fund, it was coming across the bridge the other day coming into town and i was talking on my cell phone and my driver, senior citizens, said mr. martin i am drawing social security now and i don't understand what all the hullabaloo was -- hullabaloo is about us not getting our social security checks during this this debt ceiling debate. then he surprised me further and he said, after all we have got a social security trust fund sitting there that we have paid into. at least i have paid into it all my life, you have too. it is true and i was pretty encouraged by that. do you understand how much is in that trust fund? he said yeah, over 2 trillion, maybe $3 trillion. i said well there is not really anything in there. i noticed that a the full faith and credit of our government. that is kind of scary in the spirit of downgrading. but the fact is, he almost ran off the 14 street rich. he looks back at me and said,
what? there is no money in it? that is a sad commentary but that is the trust fund. i call it a bust fund. there is no trust. there is no fund. now i'm going to turn to dr. douglas holtz-eakin who has a distinguished record as an academic, policy adviser and a political strategist. currently he is president of the american action forum, and during 2001 and 2002 he was chief economist for president george w. bush's council of economic advisers. from 2003 to 2005 doug directed the nonpartisan congressional budget office which provides budgetary and policy analysis to congress. during 2007 and 2000 he was director of domestic and economic policy for the john mccain presidential campaign. dr. holtz-eakin has held positions in think-tanks including the peter peterson institute for international economics and the paul volcker
chair in international economics at the council on foreign relations. he has also been a visiting fellow at the american enterprise institute and the heritage foundation. he received his ph.d. from princeton. he began his career at columbia university in 1985. he doesn't look that old but i guess he is. removed onto syracuse university from 1990 two to 2001. at syracuse dr. eakin was trustee professor of economics at the maxwell school and chairman of the department of economics. dr. holtz-eakin serves on the boards of the tax foundation, national economists club and the committee for responsible federal budget. douglas holtz-eakin, the floor is yours. [applause] >> thank you jammin thank you 60-plus and happy birthday to social security. i hope i make it to 76. i also have three parts to my
remarks. anyone who talks about the system at this point in time has to document the problems that are out there and spend a little time on that. and for the purposes of framing the debate, i want to talk a little bit about what i think are the five crucial decisions that one has to make thinking about this is a -- future of social security. once you go through that list you will know where you stand on reforms and i will close with some thoughts on the way i think the united states should go. but let me just start with the problems. the top problem here so much about is the financial condition of social security, and there are many different numbers. there are eight gazillion different metrics and it is absolutely positively easy to get completely baffled by what is going on. so the simplest way to think about this is that revenues in the system or 5% of gdp as far as the eye can see so that is lie number one and line number two which is benefits would have to come out is to be 4.5%. wheezed around the surplus is
that the surpluses are going to benefits are now but the revenue coming in and they will rise to about 6.5% of gdp so the problem is benefits are here and revenues are here as far as the eye can see. you can add that up for 75 years or you can do buzz lightyear math and run rented out to infinity and beyond and get all kinds of different numbers but the policy problem is very simple. we have promised benefits that exceed the revenues for the system as far as the eye can see and that has to be addressed somehow. i will come back-to-back, but i think there are problems that get lost inside of that. the first is that there are very different problems in the retirement part of the system which is 83% of spending in the disability part of social security which is about 17% and often disability gets lost in this discussion. i am not a disability insurance expert and don't claim to be one but this is the one thing and the reforms have to be done in conjunction with one another and we have to get that right in
doing reform. the second thing to remember is that social security is a powerful government policy and as a result has powerful incentives for the function of the economy. it affects how much we say. it affects how much we work and how long we work and we ought to think about the economic incentives that we are presenting people with when we do social security reform and not just count the dollars and in the dollars out for purposes of doing the financial accounting. it troubles me sometimes when we forget that this is such an important part of our economy. the third thing that i think jared mentioned that i want to emphasize is that most people who look at the system and up coming to the conclusion that the minimum benefit is too low, so that when you are doing reforms in the face of financial difficulties step one is to make them worse and actually overtime raise the minimum benefit and then figure out how you will make the rest of it add up because i think there is a universal agreement that this
part of the system has to be addressed. and then lastly, i think the key problems are really the problems of uncertainty in the political process and as jim put it that we are not here to talk politics but the fact that we don't fix social security, the fact that we now have workers uncertain about the nature of the deal they are going to have on social security when they retire is a disservice to everyone, and that uncertainty is bad economics. it is bad policy and about to be resolved as quickly as possible and indeed every year that we delay in fixing the system we make things harder. so we should address the fact that failure to reform social security and put it on a solid and sustainable footing is bad policy in and of itself. what do we need to do to fix it? we have to go through the list and decide where we are going to be. step one is how much are you going to do on the tax side and how much are you going to do in the benefit side? there are lots of ways to disguise the things that in a band you have to make a decision
about where you will come down on that. that is the most politically charged of the decision that congress will have to make in reforming social security. step two, which is different but equally charged, is whether you want to continue the practice of funding social security on a pay-as-you-go basis of where current benefits paid the benefits of current retirees or do you want to have moved a move to a system that pre-funds would each individual pays for social security and retirement? if you make a decision about that you dictate a lot of your ability to handle the financial problems of social security. the problem again is on a pay-as-you-go basis the revenues coming in are not enough to cover the benefits going out. if you decide to move to pre-funded system where i pay for my own retirement system that problem hasn't gone away so you have to things pay for, current retirees and their own and yet to figure out how to solve that problem. the third decision to make, how progressive you want the system to be? just how much in the way of
benefits and taxes do you want to assign to each part of the income distribution and if the system is currently progressive in its overall nature, but you could make it even more progressive and you could for example not take it a universal program by not providing benefits to high income individuals. that will make for a very contentious political debate but that is the nature of of the decision you have to make when you come down with that. the fourth one is what kind of incentives you want to offer? probably no real political heat there because it is hard to get the political class excited about the things that jared and i spend our younger years mastering, but it is an important part of it. lastly, how are you going to handle the transition from what we have now to any reform system x. to what extent will you exempt those currently retired? most people would conclude absolutely you cannot change that deal. how about those near retirement?
well, the standard operating procedure and social security proposals for the past decade has been to exempt those near to retirement and that has been defined as 55 or older. that i think is a very important decision when you make that because it absolutely increases the urgency of doing social security reform quicker and quicker. because, in and begin the fundamental problem is the demography. it is the retirement of the baby boom generation. i am the trailing edge of the baby boom generation. i'm 53 years old so if you grandfather anyone 55 or older you have two years to get douglas holtz-eakin, you have grandfather the problem. so my bumper sticker for social security reform has always been get doug holtz-eakin. i think that you know this increases the urgency that we see action and see action quickly. where do i come down on solutions? well, i agree with something that jared mentioned and offer
some others. first of all, i agree we should always run government programs with accurate measures of inflation, so i endorse the highly geeky chained cpi. every american should become familiar with that term. i would favor slimming benefits and a highly progressive way. certainly, you could change the benefit formula to have a lower replacement rates were higher lifetime earners. you could do the proposal by mr. posen for a mixture of wage and price indexing after the initial benefit in retirement. i am pretty much indifferent to how you do it, but i think that having a universal program that is less generous to the affluent is absolutely a sensible way to go. i at least would raise the normal retirement age, but would retain the same early retirement age and worry a lot about the line between the disability program and the retirement program as you do this because
they think jared's observations on longevity are matched by things we love -- know about the correlation between health and wealth and you want to make sure you have this well calibrated across income distribution. i would raise the medicine benefit. as i said before if you have to do that. and i at least would add on a private investment account with an additional payroll tax, an add-on account not using the existing payroll structure because we don't have adequate retirement savings either on a personal side or in the employer retirement system. we need to find different ways to give people both access to the higher on average rate of return equities with the knowledge meant that there is risk there and we have all seen that. but also to just expand the base of the retirement security. now, things not on him list you will notice are raising the payroll tax rate or raising the
cap, and here is why. one possible reason is -- i am a republican. >> that is my reason. >> i knew that i thought i would preempt that. we in fact to face, in my view, and an incredibly threatening fiscal outlook. every one of our social safety net programs, social security, medicare runs $280 billion a year, medicaid is essentially paid for by her children and entirely debt-financed. these programs are disservice to the beneficiaries because we cannot rely on them to be there for the next generation of the poor and elderly. they often don't serve their constituencies well. medicaid is by no one's idea of good health program and we are going to have to reform all of these in some deep and fundamental ways. we simply cannot tax our way out of these problems. there is no projection that i've ever seen that you could sensibly say the solution is to
tax our way out of it. it may be the case that we are going to have to raise some taxes and the process of dealing with the problems and i think the domenici rivlin and the bowles-simpson commissions provide an important lesson there when they say if you want to talk about higher revenues, the route is through tax reform. it is not in jacking up the existing tax structures and i take that seriously so i avoid going there on social security payroll tax and i also am painfully aware that the place where we are most likely to need more revenue to cover spending problem will be medicare and medicaid, and health programs in general. if you have got that risk i don't think you start out by solving social security. i think you reserve that for the place where it is most likely to raise its head. so i would do this on the benefit side and there are many plants out there that show we can make this work or going closing let me talk a little bit about jared's i.d. and the domenici rivlin planet exposing the poorly sponsored health insurance to tax.
i hope there are no ph.d. trained economist who argue that it is a good idea to have an open-ended tax subsidy to any activity that is more generous to the recipient than the poor and that is exactly what our current tax treatment is. it is in the eyes of most analysts bad health policy. it is certainly bad tax policy and one certainly ought to is part of the tax reform mentioned earlier, absolutely change that text treatment and find different ways if you want to subsidize health insurance to target that subsidy more effectively across the income distribution and to make people more cost conscious at the margins. i think that is very important. alice rivlin and paul wright and included the tax reform and it is not new and in the spirit of putting everything on the table i certainly think that should be on the list. my guess is though when you finally collected dollar off of employee sponsored health --
that is where biggest problems are but again i want to thank everyone for the chance to be here today. it is always a pleasure to listen to jared and disagree with him and i look forward to a discussion. [applause] >> i want to thank everybody in thank wire panelists and i want to ask jared bernstein if you would care to respond to that, but then we are going to entertain any questions that you may have for the audience. we have a microphone that will be passed around so we want you to state your name and direct your question to one of the panelists. first dr. bernstein probably wants to respond. >> just very briefly. i thought he framed things very well and set them up, set us up or a good q&a. there are two points that doug made that i want to clarify and one i want to very strenuously disagree with deep respect. the first is doug distinguished and made a very important
distinguishing comment about the difference between means testing benefits, means tested social security benefits as a way to make the system actuarially whole as one of the contributors, and changing the benefit formula at the high and of the way we calculate these things so that people who have very high earnings throughout their life would have lower social security benefits than they would under the current plan. those are two different approaches and substantively, and i think in terms of actually their effectiveness, are quite different as well and i very much would oppose means testing and again if we are going to go to a benefit -- if we are going to get some of our savings from cutting benefits i thought the second part of that was a much better way to go. there are a lot of reasons for that are goat there are
administrative complexities with the means test. their bad incentives for the means test regarding older people's marginal tax rates at work but mostly the problem is and he gets back to my point about health benefits, even though they are not all that generous, means so much to the middle income seniors. a means test that raised enough revenue to nick a difference would have to go way down into the scale. you would have to start taking social security income away from middle-class beneficiaries and i don't think you want to do that. so the thing i strongly disagree with, think doug said and you can correct if i'm wrong, think doug said he wants to give 100% of the revenues to fix social security from the balance and if that is your position than i think that is a unfair and b very much misguided in the spirit of what i was talking about. >> dr. holtz-eakin would you care to respond?
>> i agree with jared on the first one in the second one yeah that is what i said, and i both believe that it is feasible to do it. if you look at lots of different options it is not hard to put together reforms that meet that test. if you look at the second reason, it is the strategy that we are going to have to face is a country on dealing with an overwhelming deficit problem so i think there's a big difference between looking at social security and isolation versus thinking about the political economy and fixing social security and many other things which we will have to fix. >> bring the mic down here, please. >> if you could say your name, organization and the question. >> hi, i am logged. i'm the former chief of staff on the aging committee and then i worked in the clinton white house and have enjoyed doing op-eds and have actually been on the radio show with you doug.
jared, always very impressed with your work on tv. but i am distressed when i come to a panel like this and think it is going to be really objective and it is much 2-1 as i have ever heard on a panel. a couple of points i want to make her. the trust fund questioning whether exist where there is real money. wind claude pepper tip o'neill and reagan had the deal and 83 they knew that they were creating a system that seniors would pay and and it would go to saving social security right for what it is now which is 2037 and then have to be perhaps tweaked a little bit after that. there was no debate over that. that was the deal that was struck and to say that there is no trust fund -- when you go to the trust fund now on social security's web site, trust fund there is grass year by year and there have already been 11 years in the past starting in 1963, and very few people know this, whether the trust fund actually was tax to pay that particular
year's deficiency. and so this is not a new thing that through 2037 there would be years that the trust fund has to absorb. so i'm very distressed when people say -- it is like telling your bank, you can use my money for other things. we don't care, so that argument does not hold. that is seniors money and it is solid. the other point that i want to make is that this is not a matter of dollars and cents, doug. this is a matter for kind of country we are and what our priorities are. social security and medicare aren't just dollars and an dollars out of based on property, based on ill health, based on health and welfare and based on food stamps. so what is the cost to america if you downgrade these programs to what taxpayers will have to pay for the recovery of that half of senior citizens you say are safe from poverty, the 90%, good portion of their income? >> may i respond? >> one other point i need to raise for a question. private accounts. boy would i not want to have a
private account if one built clinton was present the stock market was the equivalent of 14,000. it is now at 11,000. that is real food off seniors tables if you have privatization of any kind and that is why people like nancy pelosi and others have said first do no harm. said to go that route is really an outrage to seniors, stealing so you can give the tax breaks to the oil companies and all of that. >> may i respond to your question? thank you. before we go there, bob, before we go there i would like to respond to your question. i used interviewed senator claude pepper and out of respect we called him senator when he was still in the house of representatives. i wrote for the tampa tribune ben and i broadcasted wg b.s. radio in miami, florida during that period. i love claude pepper. he helped so many seniors out of poverty including my mom who worked into her 80s.
she depended on her social security check quite frankly. you know we could go on all day about privatization in the stock market going up -- down today and up tomorrow. over a 44 year history of the market, i challenge you to tell me it has not grown during -- that is the lifecycle of the average working man and woman. now, i would allow -- [inaudible] >> and the fact is i would like to have someone respond or jared bernstein. >> i think we would both like to respond. thank you, great points. i particularly wanted to get back to -- i disagree with jim as strongly as you do want his point about somehow that those bonds are meaningless. essentially you are saying we are going to default and we just went through a period of saying we were going to default than i think that is extremely destructive rhetoric.
listen, on the stock market, i totally agree with your points about privatization again, because the problem with the stock market in private accounts is that it introduces the timing dimension into social security that doesn't exist when you have a guaranteed benefit. so if you happen to retire in a down market you are kind of screwed. what is interesting is that canada has -- invest part of their trust fund in equities and the center of american progress which i think is good liberal street credit, is suggesting a plan to help us solve social security's financial problems by investing 25% of its trust fund in equities. now you maintain the guaranteed benefits is likely due in canada but you tap some of the growth in equities. by the way, if you think of the shortfall in terms of the payroll tax gaps, about 2.2 right now, that would close about 40% of that gap according to calculations.
>> thank you. i mean, couple of points. first and foremost, on the trust fund, there is a long-standing dispute about just how much they knew when they pass the 83 reforms because surely after they were passed there were revisions to the forecast that showed that the surpluses weren't what they thought during the discussion in the greenspan commission. i will leave that to the historians. i will leave that to the historians to fight. and there remains a dispute, and the second thing is, in terms of the trust fund, i mean, the sad fact is if you go take a bond out of the trust fund and walked to the treasury and say i want to redeem at the treasury will be able to redeem it in one of three ways. it is going to either give you another bond and that is not going to help you very much or is going to have to go borrow some money or is going to have to cut spending to raise taxes. so, that is for but the bond in and of itself does not carry the
value. it is the power of the treasury and the power of the congress to alter spending that ultimately ultimately. >> just want to make clear -- you would not call it a bus. >> i will respond for myself. third, my proposal wasn't privatizing social security. it was keeping the same basic defined-benefit plan and adding on an additional saving, very different. we do know something about how these various accounts have performed. they don't have to be all that -- you can hold treasuries if you want. we did in fact in the united states in 2001 or two, forgot which, allow the railroad retirement fund to invest in equities and managers have in fact done that. and if you compare the performance of the railroad retirement fund from 2001 to now which includes include some fairly choppy financial years -- let's leave it at that -- it far
exceeds investments in treasuries even with what went on in 2001. so, i would like to see this debated on on the merits because we have in fact retirement problems. in the last is, i wouldn't disagree with you that this is about values. absolutely and ultimately budgets are policy and policies reflect our values. i certainly believe that there is a good case to be made on the value of benefits to the poor and the taxes to the rich and i addressed why i came down where i did but i think the one thing that has not been discussed, in this country every one to say they are happy that their taxes went up or their program got cut, that if we don't do some of those things we are going to ask our children to do one or both in the midst of a damaged economy. that to me is fundamentally unfair and almost immoral. so, let's not forget those constituents who are yet unborn in very poor.
>> thank you. in the back there. >> i am nervous. excuse me. my name is judy lear, lear just like the king, and i'm the national chair of gray panthers. we too are celebrating the birthday, and i have a press release here of social security, 76 years, and we are doing it with a media watch campaign to know the facts about social security, and to fight truth decay, to make sure that some of the things that you are saying people understand that is not through, such as the fact that the trust fund is going to go broke. it will not go broke. i want to advocate for raising
the taxes. >> maam, your question to all the panelists please? >> i want to know why -- right now it is at approximately $108,000. that is what the tax is. even if they raised it to $250,000, think of how much more money. now you were economists, and you would be able to tell us how much more. how much more could that be, and if you raise it all the way, have 4.2% that it just dropped down to, if i could just drop down to, how much more would go into the system? >> thank you. thank you. >> jarrett who will prove to be a better resource than me is looking up the number you want. i don't know the number. it is an older number.
it is important to distinguish two different things. one is raising the tax -- taxable maximum and continuing the tradition of having benefits awarded on the basis of all earnings, if you do that you actually may in the near term race tax revenue but since you are going to give out more benefits in the future you did not solve a lot of these problems by doing that. so the alternative then is just raise taxes. do not award additional benefits on those earnings which have now been tax. that changes the character of social security and many people are comfortable with that idea that you break this link between the tax base and the benefit days and thus break a key feature of the system. so as i said, i am not wild about raising taxes per se because number one, we have got lots of financial problems and i don't think this one is going to be the one that drives us as much as some of the others and number two, it really strikes me
that we need reform not just the flat increase and that would be the place i would rather go. >> so, the increase to apply the payroll tax to a higher level of income strikes me as absolutely part of any reform plan. >> would that provide benefits as well? >> yes, and in fact if you took it up to 90% including providing the benefits you would close 40% of the outstanding gap over the 75-year period, which you know ain't nothing. and there is a menu here. you had the cpi we have been talking about. that gets you to about a little bit under half -- wait, i'm sorry. yeah that gets you to a little bit under half of the gap and doug and i could come up with other options but i want to
focus on your point about, which is in direct contrast to doug's view that we shouldn't tax -- we shouldn't close any of the gap through tax. we should do it all for the benefit cut side. there is a great op-ed in today's "new york times" on warren buffett, which talks about how just, just how -- he calls it cobbling millionaires. not only how much income is accumulated at the top of the scale but how taxes those millionaires and billionaires are paying on those incomes have declined. he talks about paying a 70% tax rate on his income which i calculated to be 40 million. that is his talks both -- taxable income and i'm sure he has other things going on. he said everybody else in his office pays 20 to 30%. so the reason why you are now
applying this payroll tax to such a considerably smaller share of the income scale is because of this concentration of earnings. so it is very important to tap some of that, correct some of this imbalance especially when it is distributed through a progressive program that is as efficient and effective as social security. >> let me respond briefly. >> can i make a point on the tax.just so all the cards on the table? americans hold to be true to things. they believe that rich people don't pay taxes. they can always obey them but we should get more money by taxing the rich. someone is going to have to figure out how to resolve this at least in my view and the answer is of course to figure out how he want to tax the rich which is to say have a real tax reform that make the impossible through financial manipulation to legally avoid taxes, which is a big chunk of what is going on. i would be all for that.
i think that is the key. how you tax rich people, not just taxing them that matters and a lot of this discussion is highly misplaced. the second is fairness. social security per se is already fundamentally redistribute tour it. i hear this discussion is says we must raise taxes on rich people and i want to take away their benefits in the net impact will be the same. they are going to on net pay in more than they get out. and so i'm always baffled by the asymmetry in the discussion. it is about the net impact of the programs on people of different lifetime earnings and that should be the focus in my view. and lastly, fairness is in the eye of the holder. so there will never be a scientific adjudication of these disputes but it strikes me that if you look broadly at entitlement programs and for many of social security that's been true that they paid in far less than they took out. i would go through the other examples. that has been the history of the
program. certainly a medicare and medicaid, where the largest tax most americans pay is the payroll tax and they paid in far less than they ever get back in benefits, and what that means is that for those paying income tax, which is only 50% of americans and where 5% of americans say 60% of the income tax, they are paying all those entitlement assets plus our kids are borrowing like mad so these people as payroll taxes are net winners by a long margin and the kids are paying for it in the high income americans are paying for it and the high income americans are providing all of the basic government envisioned it. they're paying all the infrastructure come all the education and basic research and it strikes me as quite odd when a tiny minority is providing all the government to say it is really unfair that they don't provide more. i don't understand that. >> it is certainly not the case in payroll taxes. >> that's right that they are
giving out more than than they pay an. >> absolutely. >> let me intervene here a second and comment on the social security trust fund. i don't care what you tell me, it is broke. and the fact is, it is like somebody putting -- like a journalist once said, it is putting $50 of your paycheck on friday under a shoebox under your bed for your daughter's college education 18 years from now but on wednesday you borrow that 50 back and put in an iou. let me tell you something. as doug is pointed out you were either going to have to cut benefits, raise taxes, or the scariest of all in today's economy, borrow the money. and i don't see us are wearing -- maybe we would our wood from china. look, our time is up. and to thank everyone for coming, especially i want to tank your tv and radio audience. if you want more information about 60-plus visit our web site, 60-plus.org.
60-plus now has over 7 million seniors that we rely on for keeping abreast of events that affect them. i would be remiss if i did not thank 60-plus staffers here today, mary mahoney, matthew conrad, laura closser, jeannie trues los as well as others we depend on at 60-plus, randy randall, chris craig, kimberly and of course our newly installed president amy frederick who is out of town busily recruiting seniors to our banner. icr time is up at 60-plus. we thank you most sincerely for yours. give our panel another round of applause if you don't mind. [applause] thank you and by the way, have to add this with. while someone said it is 2-1 conservative, it is now 3-2 because we have two questions from the liberal side. thank you.
>> the u.s. commission on civil rights recently examined the issue of eminent domain, laws that allow local governments to take private property with just compensation if the purposes on a public use. the event includes discussion about the impact of the extreme court 2005 decisioning k-kilo versus the city of new london, which expanded the government's
power by ruling that local governments can use economic growth as a justification for taking private property.ar was this event is an hour and 40ived minutes.t of t >> good morning, everyone. this is the auspicious date of august 12. this is a meeting of the u.s. commission on civil rights. it is now 9:35 on august 12. this is taking place at the augt commission's headquarters at 6249th street northwest ine coin washington d.c. i'm chairman marty castro.norttn the first part of today's meeting will be a briefing at the civil rights implications oh eminent domain abuse. immediately following the briefing we will conduct are breaking their monthly business meeting. before he became introductionse. of the panelists and everything, i think to do something that iso always a good thing to do istha talk of a new member to thew met team. i think to welcome our newesto w
commissioner about a week ago co today. we're glad to have you on boardy today's briefing features for distinguished panelists. each was speaking terms for dist approximately 20 minutes. i'll be the timekeeper and it developed a specialty speve d ofc data from our last briefing and told last briefing, until. after all, the panelists have had their presentations made, we will then turn to our commissioners for questions. will have approximately 50 minutes of questions that will be commissioners asking the panelists. as at the last briefing what i would do is i will acknowledge commissioners who raised her hand and i will be fair and balanced in terms of the opportunity. unlike the last briefing we'll have more time here. so if the commission was to ask a follow-up question to the original question, please do so. if you want to fall to your follow-up they will ask you to hold onto the next times would try to make sure that at what has a fair opportunity ask questions to out the period. so the speakers, you'll see
these little traffic lights in front of us. so when the light goes from green to yellow, that means it's time to start wrapping up. when it gets to read, of course that means stop. when you see yellow that means you have to manage remain in your time. i will do my best to strictly enforce that so we have a full opportunity to hear from you, at the same time have commissioners ask their questions. with those bits of housekeeping, let me just add that this is a briefing that was proposed by our colleagues in the former commission majority, and in interest of bipartisanship, we are pleased to be able to do this briefing today because it does raise some very interesting issues. issues that we all have reviewed the material that were distributed for him. we are very much looking forward to hearing the statements. i know have a lot of questions to delve into this topic. but we're pleased to be able to do this in a bipartisan fashion. our first panelist is ilya somin. and associate professor at george mason university school
of law. professor somin's research focuses on constitutional law, property law, and a study of popular participation. and its implications for constitutional democracy. among his many accomplishments, in its amicus brief on behalf of the urban planet scholar jane jacobs, which was cited by the sub in court in his majority opinion in kelo v. city of new london. our second panelist is j. peter byrne, a professor of law at georgetown university law center. he teaches property, flanges, historic preservation and constitutional law. in addition he is faculty truck of the georgetown climate center, and at the georgetown environmental law and policy center. and i visited georgetown last month and it's a beautiful campus. i had never been there. our third palace is not here yet. but i will get his background when he arrives so he can immediately go into a statement. hilary shelton. mr. shelby lasers at the director of the naacp's
washington bureau. and senior vice president for advocacy and policy. the naacp joined an amicus brief in support of the plaintiffs in the kelo case and has testified before congress regarding the civil rights implications of eminent domain use. our final panelist will be david beito. he is a history professor at university of alabama. much of his academic work is focused on african-american history in the 20 century. he is also chairman of the alabama state advisory committee. is what good does that because as a former sag member, sector as well, i'm pleased to see you here. it's something the commission wants to do is engage more of the work we're doing. is hosted of good to have a member of our extended civil rights commission family at the table. also, professor somin understand is the spouse of one of our special assistance, so we have family at the table and we always appreciate having that. in his presentation, professor beito is going to explain the work of this alabama state advisory committee on this topic.
it's already conducted two public hearings on the subject of the eminent domain use in his state. so we're looking forward to hearing about that. and with that i would like to ask professor somin to begin your remarks. >> thank you, mr. chairman. i'd like to start i thinking chairman castro, vice chair, and other members of the commission for your interest in this very important issue. president obama has written that our constitution places the ownership of private property at the very heart of our system of liberty. unfortunately, over the last several decades, both of course and often legislatures as well have routinely consigned property rights to second class status, usually failing to give them the sort of protection that is accorded to other individual constitutional rights. it is particularly appropriate, therefore, for the u.s. commission on civil rights to consider this issue here because property and the ownership of it was actually at the heart of the conception of civil rights that
underlay the enactment of the 14th amendment. it was central to the rights of the framers of the amendment hope to guarantee african-americans and other minorities. in my presentation, i will first briefly speak about the constitutional law of eminent domain, particularly with respect to the public use clause of the fifth amendment. then i will talk and a bit more detail about the impact of eminent domain on racial minority groups, which both historically and today has often inflicted great harm upon them. and, finally, i'll briefly talk about the reforms that have been enacted since the supreme court's decision in kelo v. city of new london, and explain why those reforms, while the have improved the situation, in many cases do not go far enough to fully protect the rights of minorities and others threatened by eminent domain. so i will start off by looking at the law of eminent domain, with respect to the public use clause of the fifth amendment.
that clause like similar clauses in the state constitutions allow taking and condemnation of private property only if it is for a public use. there's been a long-standing debate as to whether public use means in actual use by the government or by the general public, or whether it merely means anything that might potentially benefit the public in some conceivable way. during the founding era there was not a lot of discussion of the meaning of public use. however, most jurists and commentators did have an understanding that taking the transfer property from a to b. as he was sent from one private individual to another, that those were not permitted by the constitution. perhaps more relevant to our current debate is the fact there was a lot more discussion of this during the time surrounding the enactment of the 14th amendment in the 1860s. and, of course, its the 14th amendment which applies the public use clause and the rest of bill of rights to state and
local governments, the government entities that can dust the vast majority of taking. during that period, opinions and certain was divided. however, as my recent research suggests, the majority of state supreme courts and also the majority of treatise writers on this subject of eminent domain took the view that public use does in fact have to be a used by the government or at least by the general public, not merely something that might benefit the public in some way. moreover, as i've already noted, the framers of the 14th minute, one of the principal reasons for wanting to incorporate the bill of rights against state governments was to protect the property rights of asking americans and also by supporters of the union in the south against the depredations of state governments that were threatening those property rights in many ways. and so it would not have made sense given that objective to apply an interpretation of public use that essential that state and governments, for
whatever reasons they want. those other entities the amendment was supposed to constrain and prevent from engaging in a jesus. now, unfortunately modern supreme court cases are the last 50 or 60 years, particularly the berman case in 1954 and most recently the kelo case have taken the view that a public queues is almost any potential public benefit of any kind. had even taken the view that it is not even the case the government has to prove that the supposed public benefit will actually be achieved. in my written testimony i described in some detail why this modern jurisprudence is deeply flawed. here i would just make one point about it, and that is that their position really makes very little sense given the whole point of having a constitutional right in the first place. the position of the supreme court is that the definition of public use is largely left up to state and local government.
but, of course, the whole point of having a constitutional right is precisely can -- to constrain, so it makes no sense to leave up to that very same government the definition of the scope. and, of course, the court hasn't taken a similar view with respect to any other individual right in the constitution. this is a unique case almost. now, given the state of affairs for over several decades the supreme court and lower federal courts have given very little protection to property rights. there has been a tremendous social impact on americans of all racial and ethnic groups. however, by far the biggest impact has been that on racial and ethnic minority. and this has been recognized by scholars, activists and others from across the political spectrum. since world war ii, hundreds of thousands of people have been forcibly displaced by polite
condemnations, and also by economic development takings of the sort that the supreme court approved in the trade came? but the vast the good of those people were forcibly displaced are, in fact, called poor african-americans or hispanics. during the 1950s and '60s, the prejudice in these sorts of takings was so blatant that urban renewal takings were referred to by many people as negro removal. today, minorities continued to be disproportionately victimized by polite condemnations and other takings of that type. in my view today, the motive is really open and explicit prejudice against minority. however, the political weakness of the urban minority poor is a big factor and the reason why they tend to be targeted for these sorts of condemnations. and that political weakness is of course at least a part of a consequence of the prejudice and discrimination that these groups have suffered for decades in our
society. and in most cases when people are displaced by these condemnations, although they do get some compensation payments, they are left off significantly worse off than they were previously because the payments rarely, if ever, fully account for their losses. in recent years, in addition to taking areas which one might consider to be truly blighted, in many states the definition of blight is expanded so much that almost any area can be declared blighted and taken. in recent years courts have ruled that such areas as downtown las vegas and towns pressure and time square in newark city are blighted, thereby justifying condemnation in those areas. and, of course, if times square is blighted than almost any area could be so consider. in addition to like takings, a. economic development takings of this sort up help intranet also tended to most affect minority. some people have argued that
takings i actually benefit the minority poor, because they promote economic growth in their communities. i think this argument is great overstated for a couple of reasons. what is it the sort of condemnations often actually destroyed far more economic asset than they create. they routinely destroy large numbers of businesses, schools, homes, and other valuable assets for the committee. second, in those situations where there is a meritorious private development project that is likely to produce more growth than it does places, the market has good methods to allow developers to acquire the property without resorting to eminent domain, methods that are superior to eminent domain. i discussed this in my written test mike and i'm happy to discuss it further in questions. finally, it should be noted that respect for property rights is itself an important engine of economic growth. recent research in urban
economic and development economics strongly suggest that areas with respect copyrights see more investment, people are more secure in their homes and businesses, and that tends to promote growth were as an constrain government in copyrights are reassortment of them tends to have opposite effect. economic growth is an important objective, and so is the removal of blight. however, i would argue that we do not need to destroy a community in order to save it from blight. there are more humane and also more effective methods of alleviating blight and use of eminent domain, and ones that don't forcibly displaced a large number of people. in recent years since the supreme court's kelo decision in 2005, some 43 states have acted new eminent domain reform legislation. and some people have said this solves the problem of eminent domain abuse. i wish that were the case, but for the most part it is not.
as i discussed more fully in my written remarks, the majority of these new reform laws actually will have little or no effect. they claim to ban economic development taking, but they allow the very same types of takings to go on under the name of blight condemnation, with blight being defined so broadly that pretty much any area qualifies. even in states which have limited the definition of blight to areas that a lay person would consider blighted, the minority poor still tend to be at risk because of course many of them tragically to live in communities that fit that definition. only four states have completely banned all white condemnations, and, therefore, only in the states are the rights of the poor against these sorts of takings completely secure. i think any aftermath of kelo there has been some genuine progress made, and certainly public awareness of this decision has risen. however, there's a great deal more work to be done before we can fully guaranteed
constitutional copyrights to all americans, particularly those are most vulnerable, such as the minority poor. so i very much welcome the commission's interest in this issue, and i hope your interest will stimulate further discussion and further and more effective reform in this crucial area. thank you very much. >> to fester byrne? >> -- professor byrne? >> thank you, chairman castro and members of the commission, appreciate the opportunity to speak with you today. this hearing addresses claims that the use of eminent domain for economic development unfairly and disproportionately harms racial and ethnic minorities. professor somin has a remedy which reprinted all eminent domain for economic development, including a nation from blight requirements. in my view, this is a non sequitur to remedy and nonexistent problem.
the claims that eminent domain unfairly harm the minorities draws on history of urban renewal prior to the 1960s and, indeed, many african-americans and others were displaced by publicly funded projects that bulldoze their homes in largely failed attempt to modernize cities. justice clarence thomas' dissent in kelo v. city of new london for the audit the use of emmett domain for economic development would inevitably harm minoriti minorities. such concerns in our time are seriously misplaced. read-a-thon projects using eminent domain continue to be an invaluable tool for maintaining the economic competitiveness and livability of the urban areas where property ownership is fragmented and where minority's live in large numbers. the discriminatory elements of older from an -- generally prevalent to click live in the 1940s and '50s. and have been largely eliminated either growth and part of
african-americans and other urban minorities as well as the change physical relations between the federal government and local governments, the fx which has been to give greater control over redevelopment projects to local local processes. use of eminent domain rarely now apply to residences. today requires political consent and community buy-in. eminent domain is a crucial legislative power exercised by governments around the world dating back at least to roman times. in a passionate it empowers government for the construction of networks and the assembly of large tracts, even private owners do not wish to sell or hold out for excessive payment. under our constitution, owners are protected by the requirement that the government pay them just compensation. the meaning of the takings clause of the fifth amendment related taking property for public use long has been controversial. but no, and i repeat no supreme court decision contradicts the
holding of kelo, the public use includes publicly approved condemnations for economic redevelopment of economically distressed areas. the quality of redevelopment projects of course varies, but recent successful projects can be found from the ferry building in san francisco to times square in new york. economic revitalization of urban areas tends to aid poor minorities who disproportionately dwelt in cities by increasing employment and tax revenues for education and city services. without emmett, such eminent domain, large-scale development projects can occur only on greenfield sites, on the edge of cities, exacerbating urban sprawl and pushing new employment opportunities further from urban minorities. political realities have changed dramatically since the urban renewal period. minorities have secured significant political power in nearly every u.s. city, as was
increased influence in private real estate markets. redevelop projects have largely come under control of local governments as federal money and direction have disappeared. local officials tried to avoid displacement of homes because of negative political repercussions and expensive litigation. federal and state statutes had many instances have increase the payments due property owners about what just compensation requires. these circumstances the condemnation of homes is rare and has little or no identifiable ethnic or racial character. the plaintiffs into kelo case were white middle-class people which explains a good bit of the political hysteria that surrounded the decision. the changes in the political of our economic government can be seen by comparing the urban renewal in southwest washington, d.c., in the 1950s, approved by the supreme court in berman v. parker with the use of condemnation in d.c. today. a massive condemnations bulldozing and reconstruction of
southwest washington comprised a complex episode with many facets, but poor african-american residents seem to have suffered this portion displacement. at that time there was no democracy or elected government at all in washington. statute authorized the project was enacted by congress where d.c. has no representation, and till today which is a good topic for this commission to take up. and the members of the redevelopment land agency decade of the project were appointed by the federal government, or their d.c. appointees. the most controversial exercise of eminent domain in washington, d.c., in the past decade has been the condemnation of stores in the sky abandoned strip mall, to permit the construction of badly needed private supermarket for an underserved community. that action, although bitterly contested in court by some owners, was supported by many members of the local community, specifically approved by the d.c. council which is a
majority, which was majority african-american membership, and signed by mayor anthony williams. although specifically exercised in order to convey the land where private developer would be absurd to suggest that the case presents a civil rights issue appropriate for consideration by the u.s. commission on civil rights. but it would come within the kind of concerns of professor somin, to which i will return. similar observations can be made about the use of eminent domain by the dudley street neighborhood initiative in boston to assemble land for affordable housing projects. nowhere is the reason that development are more likely to harm minorities and condemnation for traditional public uses. many of the most brutal condemnation in the urban renewal period were accomplished for highways and public housing where the government would own site. government has the same general incentive to seek less expensive or flourishing lands for condemnation, would ever be used
to be made. if the goal really is to protect minorities, why are the proponents not seeking to constrain the use of eminent domain that have historically been of most harm to minorities? yet legislation recent introduced in congress, h.r. 1433, ignores these exercises of eminent domain for highway construction and other public projects while prohibiting economic develop that gives him power to aid in low income people. it also protects speculative ownership of vacant land. there's no special protection offered to residences. the case against eminent domain here has been advanced large on the basis of advocacy by libertarians for whom i have great respect for their principled positions they take. which broadly oppose the use of eminent domain because they value private property more highly and local democracy. the evidence that they marshal such as the lord victimizing and vulnerable presents ambiguous data is highly colored language.
the study shows no more than commuters are somewhat more likely to pursue redevelopment in poor areas than in more affluent ones. it does not sure properties were taken. .. protect the constitutional rights of all citizens because they oppose condemnation of our largest corporations just as much as that is the most economically marginal minority individual. the concern for the latter seems off intact to go since they doubt they would get little extreme in many quarters simply advocating to reduce the state of legislative power over private property.
if one were worried about disproportionate impacts of domain on the poor minorities, their affinities that would pro address that directly. but might provide more procedural protections or compensation to residents intocy commercial property owners?pa one could mandate minimumym payments to 10 and who don't owo their own property, who normally receives no compensation housinn condemned. the fair housing act be amended to clarify it applies to condemnation of residences without regard to intent, a topic pursued by a student of might be in a paper -- mine in a paper that's cited in my talk. they do not meet the agenda of property groups driving the issue which to limit further the powers of government to the court in favor of private ownership. proponents, rather, would deprive the d.c. government of the power of eminent domain. in a world of growing economic
inequality and a political climate demanding cutting taxes as well as medical and pension benefits, it is unfortunate we are spending this time discussing the nonissue of the effect of eminent domain on minorities, and i look forward to discussing all aspects of that in our question period. thank you. >> mr. shaw? >> thank you, chairman castro. ladies and gentlemen of the commission who invited me to talk about civil rights violations of eminent domain abuse. my name is hillary hilary shelton, a most widely recognized grassroots base -- [inaudible] we're locate inside every state in our country. the naacp washington bureau is our federal legislative and policy arm. given our nation's sad history of bigotry and the basic disregard of too many elected
officials to the concerns and rights of ethnic minority americans, it should come as no surprise that eminent domain has been misused for centuries against racial minorities and the economically disadvantaged at highly disproportionate rates. although nobody knows the exact number of people displaced through eminent domain across the nation, everyone seems to agree that african-americans are disproportionately affected. it is estimated between three and four million americans have been forcibly displaced from their homes. it should surprise no one that a vast majority of these people are racial and ethnic minorities. another study says between 1949 and 1973,2 -- [inaudible] displaced one million people, two-thirds of them african-americans making african-americans five times more likely to be displaced than they should have given their numbers in our population, unquote. the naacp has a deeply held
concern that the newly sanctioned expansion of the use of eminent domain to allow the government or designee to take property simply by putting the property to a higher use as approved in the supreme court in the 2005 decision will foster more discrimination as it sanctions easier transfers of property, wealth and community stability from those with less resources to those with more. the history of eminent domain is rife with abuses specifically targeting racial and ethnic minorities and poor neighborhoods. indeed, the displacement of african-americans in urban renewal projects are so intertwined that oftentimes urban renewal was often referred to as black removal. sadly, racial and ethnic minorities are not just affected more often by the exercise in the domain power, but we are almost always affected differently and more profoundly. the vast disparities of racial and ethnic minorities who have
been removed from their home due to eminent domain are welcome wl documented. in my written testimony, i give several examples of instances in which racial and ethnic minorities have been displaced at disproportionate rates through eminent domain, but for brevity's sake, i hope you will review my written testimony. many who observe these patterns throughout our history contend that the twisted goal of the majority of these displacements is to segregate and maintain the isolation of poor, ethnic minorities and otherwise outcast populations. furthermore, low income neighborhoods are often easier to accomplish because these people usually lack the resources to effectively contest the actions politically or in our nation's courts. look at areas with low property values when deciding where to pursue projects. thus, the state or local
government gains more financially when they replace areas of low property values with those of higher property values. thus, even if you dismiss all other motivations allowing municipalities to pursue eminent domain for private development as well as was upheld in the u.s. supreme court in the kilo decision will clearly perpetuate, not exacerbate the disparate impact of african-americans and the economically disadvantaged in our country. as i said in the beginning of my testimony, not only are african-americans and other racial ethnic minorities more likely to be subject to eminent domain, but the negative impact on these men, women and families is much more severe. first, the term just compensation. when used in eminent domain questions, it's almost always a misnomer. the fact that a particular property is identified and designated economic development almost certainly means that the market is currently undervaluing the property or the property has some trapped value that the
market has not yet recognized. moreover, when an area is taken for economic development, low income families are driven out of their communities and find they cannot afford to live in the revitalized neighborhoods. the remaining affordable housing in the area is almost certain to become less so. when the goal is to increase the tax base, it only makes sense that the previous low income residents will not be able to remain in the area. this is borne out of not only the common sense, but also by statistics. one study from the mid 1980s showed that 86% of those relocated by the exercise of eminent domain power were paying more rent at their new residence with the median rent almost doubling. furthermore, and to the extent that such exercise of the taking of this power is more likely to occur in areas with significant racial and ethnic minority populations, the effect will likely be destabilized organized minority communities. the dispersion, this dispersion
both eliminated or at the very least dramatically undermined estimates of community mechanisms that has the dehe tore crouse effect on these communities' ability to exercise what little political power they may have established. it will also hinder the development of stronger racial and ethnic minority communities. one's own community financially and otherwise directly correlates with the confidence of one's ability to realize the fruits of such efforts. as i have discuss inside my testimony, too many of our communities, racial and ethnic minorities, the elderly, the low income have witnessed an abuse of eminent domain powers that has too often been devastating. given the numerous chronicles of abuse, it is the hope of the naacp that all responses, legislative, administrative and others so address eminent domain abuse be educated and well informed by our shared history and challenges. we need to insure that some
segments of our population that have too long been muted in the issue have a voice. we need to understand how it has been too easy to exploit these communities by imposing eminent domain not only in pursuit of economic development, but also in aim of addressing blight. we also need to make sure that any compensation is fair and equitable and will not result in those who have been displaced being worse off. in considering the interests of our communities, we raised broader concerns with the use of eminent domain for any purposes including those traditionally viewed as public purposes such as highways, utilities and waste disposal. even these more traditional uses have dis proportionately affected the poor, racial and ethnic minorities and working class families. furthermore, it is not only our owners that suffer, but also our representers. whether they are small businesses who are often provided no protections and pay an uncompensated price even when
eminent domain is imposed. for those reasons as the majority in kilo suggests, there must be a sufficient process as well as protections for racial and ethnic minorities and low income communities. the process must be open and transparent, and the full participation of those potentially impacted communities need to be guaranteed as well as fair compensation must be given. fair or just compensation should include replacement costs, not just technical appraisal value. we need to insure compensation for the loss of goodwill of a business and to fairly compensate for the length of time a business or family has been at that particular location. this is the voice of our communities that all communities observe. thank you again, chairman castro and commission members, for allowing me to testify about the naacp's position on the civil rights implications of eminent domain abuses. the naacp stands ready to
develop policy to end eminent domain abuse on concerns like building affordable housing, communities with good public schools and effective acts of the high quality health care system, small business development, opportunities in the growth and a significant available living wage job pool. again, i thank you very much for the opportunity to speak with you, and i look forward to your questions and our discussion. >> thank you, professor shelton. >> i've got three handouts here, i've got ten of them, so maybe a couple of you could share. thank you, chairman castro, for inviting me here today. it reflects the spirit of partisanship that we also found very much in alabama where we decided to pursue this unanimously; democrat, republican, black and white decided to pursue this issue. let me start by saying that i speak for myself today rather than in my capacity as chair of the alabama advisory committee. i have little to add to ilya
so-in min's -- somin's very insightful overview. i'm not going to revisit this these issues, at least in my talk right here, or even really talk much about conventional eminent domain or eminent domain as conventionally understood. rather, i want to highlight a generally overlooked threat to the property rights of the poor and vulnerable. for lack of a better term, this threat could be called eminent domain through the back door. now, we decided to pursue this issue several years ago, the advise advisory committee, and as i said, all of us agreed that this was an important issue, and we've had two public forums. the first was in 2008 which was at the historic 16th street baptist church in birmingham. and the witnesses at that meeting recounted some disturbing examples of how
blacks were losing especially in the city of montgomery, we gained more and more information coming out. blacks in the city of montgomery, a city often called the cradle of civil rights, were losing their property through an extensive application of section 1153b1 of the alabama code. and i quote that more extensively in my longer paper. and this provision leaves a major loophole for the indirect taking of property outside of conventional eminent domain. if a local government deems a property structure blighted or a nuisance. now, in contrast to standard eminent domain, montgomery property owners -- and that's what we especially focused on because that's really problem to us seemed greatest, the complaints seemed to be the most extensive -- montgomery property owners on the receiving end of this section 11-53b1 do not have
a right the compensation even in theory. once declaring the property a nuisance, the city typically demolishes the structure and then bills the owner, often by slapping a lien on the property for the cost of demolition including the carting away of rubble. because the owners are often poor and many cannot atord to pay -- afford to pay and, thus, have to sell or abandon their property. all right? now, at our forum if you go to the next slide, please -- oh, yeah. there's a a quotation from frederick douglas that was in my longer paper, but it does reflect the concern for property rights in the history of civil rights, and i think it's something that we could all learn today, um, about application of property rights regardless of economic class. we hold the civil government to be solemnly bound to protect the
weak against the strong, the few against the many and to secure the lumbar blest subject -- humblest subject in the full possession of his rights of person and of property. all right? of course, douglass was not referring to slave openers there, he believed that was man stealing, that was theft of legitimate property or people that own od themselves. -- owned themselves, in fact. go to the next slide, please. this is the presentation given by a developer in the montgomery. i wish you could see it a little bit better. but he showed on a map he demolitions through this section 11-53b1 in a single year. many were in a small area of montgomery's most heavily black areas including rosa parks' old neighborhood which is in that area. now, another witness who testified at another forum that we had which was in montgomery
was, actually, this was at the montgomery meeting as well. we had two meetings first in birmingham and then the second one in montgomery. and this was presented at the second meeting. now, another witness we had was jamie mccall, and he was a rarity among montgomery's property owners threaten with the demolition of their homes. he, he decided he was going the fight back. a little bit about his background, he had scraped together a living and still is as far as i know by salvaging raw materials from historic homes and then selling them the private builders. finally, he, over time he's able to accumulate enough money to purchase two acres of land in montgomery on a very busy thoroughfare, and he started to build his dream home, what he called his dream home.
he did the work himself, he used materials accumulated in his salvage operations including a supply of sturdy and extremely rare long-leaf pine. eventually, his dream house, what he called his dream house took shape. he built it very much incrementally. from the outset the city showed unremitting hostility, and he almost lost count of the number of road blocks that it threw in his way including a citation for keeping the necessary building materials on the back of his property which is not even visible from the road. more seriously, in 2007 he was charged under section 11b-1 on the grounds that his home, then under construction, was a nuisance. please go to the next one. all right? there's his home prior to demolition. um, go to the next one, please, i think that's another view of it.
fortunately, he had snapped these pictures right before, shortly before the demolition, other side we wouldn't have -- otherwise we wouldn't have known what it looked like. and the reaction of montgomery's city fathers to this, to mccall's efforts seemed very strange the him. his view was that he was trying to fight blight by building a new home in an underdeveloped area. and be he suspects that -- he suspects that, no proof here, wealthy developers are trying to get their hands on the property which is on a major thoroughfare, two acres. but as i said, he fought back, he hired an experienced local lawyer, he negotiated a court-enforced agreement which gave him 18 months to complete the home. only a month after the agreement took effect in 2008, the city demolished the structure. and local bureaucrats were very much in a hurry, they did not give him notice when they sent
in the bulldozers on the same day as the court order authorizing them. mccall then went back to the same judge who had allowed the demolition. she stated that she had been misled, she ordered the city to pay compensation. montgomery, the city of montgomery appealed, and the complaint, the ruling of the judge, they appealed it. and at this writing, mccall has not received a cent. and his view is that the city is just going to try the drag this out as long as it can until his money runs out. 2010 i received a phone call from karen jones, another property owner from montgomery. she related a case which was no less compelling. the city had just demolished the day before her family home including furniture, family bible and old photographs. the authorities charged the property was a nuisance because the front porch was in
disrepair. please go to the next slide. that shows the property. she had no photographs to share, but we got this from, a reporter got this from google earth, interestly enough. interestingly enough. please go to the next one, please. all right. they said the property was a nuisance because the front porch was in disrepair. although the city had sent out notices before sending out the bulldozers, none of them went to jones. instead they went to finishing ori jones, you have her death certificate, her grandmother, and matthew jones who is also deceased, deceased in the year 2000. you have, also, the city still regards them, as you can see from the official documents, as fori jones as the official owner of the property even though this has been pointed out many times to them.
now, the city, as i said, claims that karen jones is not the owner, although she pays the property taxes and which are not in arrears, has a warranty deed from 2002 indicating that she is an heir, and apparently all the other family members support her decision. despite asserting that jones is not the owner, the city is, you know, well, let's go on. in may of this year, the city tried to sell the property at auction still naming the deceased, fori jones, as the owner. and, again, in the official online -- >> can you wrap up, please? >> okay. i'm going to end there, but why don't we show this very short youtube. i'm sorry i went over, but i'd be happy to answer any further questions. hope this works.
okay. >> headlines across the state, people are accusing the city of montgomery of taking their property without compensation. using the city's -- [inaudible] montgomery -- >> raise the volume? is it possible to raise the volume? >> i was born here in this house. >> built in 1920, the home of karen jones' grandmother is now a vacant lot, demolished by the city of montgomery, alabama. >> anything that's not up to their par, um, they'll just tear it down, not try to revitalize, not try to bring life back into a neighborhood, just kill it. >> city officials claim the house is in disrepair and used local blight ordinances to take it down. they did the same to a house jimmy mccall was building despite state and federal court rulings in the home homeowner's
favor. >> they have no regard for the rule of law, you know? they do what they want to do. >> montgomery has condemned dozens of homes under its blight ordinances, often billing the owners for the cost of demolition. the city then markets the properties to private developers. >> the actions that we're taking, i think, are speaking volumes about cleaning up our city and having a safe neighborhood so that we can raise our family and enjoy the fruits of our labor. >> much of the demolition is taking place along possibility come ri's historic civil rights trail to make it for appealing to residents and visitor. ironically, these efforts violate civil rights. >> people are losing their property, the poor and vulnerable and minorities really within the shadow of this apartment complex where rosa parks lived. >> the chair of the alabama state advisory committee of the united states commission on civil rights. >> the commission calls this eminent domain through the back door. all right? it's taking property, i think
illegally, without due process. >> five years ago alabama passed legislation to prevent local governments from using eminent domain for private development, but the law makes exceptions for the seizure of blighted properties, and in the case of the latter, property owners have no guarantee of compensation. jonathan serrie, fox news. >> thank you. so we will now begin for the next approximately 50 minutes or so questions from the commissioners. do -- commissioner -- [inaudible] followed by commissioner jack key. i'm sorry. >> one second. i thought this was an excellent panel, and i wanted to recognize margaret butler. >> thank you. appreciate that, thank you very much. [applause] >> thank you to all the witnesses. it was very informative and, again, i echo the fact that the chair, i'm sorry, the staff has put together a very good panel. um, one of the reasons why we
had proposed this at least when i had suggested it was not the concern with respect to kilo, but this probably predated kilo and had been a concern of a number of people crossing the ideological spectrum; conservatives, libertarians and liberals. setting that aside for the moment, professor somin, you indicated that the determination of what constitutes a public use is often or exclusively left in many cases to state and local governments. does that signal a tension between first amendment concerns and fifth amendment concerns? if it does, does primacy, should primacy be afforded to individual property right concerns over tenth amendment concerns? >> i don't believe there's any tension here at all because the tenth amendment simply says that
powers that are not delegated by the constitution to the federal government are retained by the states and the people. however, any specific individual constitutional rights that are protected by the constitution including those protected by the i have -- fifth amendment, they clearly are within the power of the federal courts to enforce, and no one has ever suggested to my knowledge that the tenth amendment somehow prevents that. >> and when did we get to a point of the notion of what constitute public use -- [inaudible] was it in the berman case, or was that in the hawaii housing authority? where did that happen? >> even as far back as the 19th century, some people made that argument and it was held under state constitutions, but the federal supreme court did not adopt that as an interpretation of the public use clause of the
fifth amendment in berman v. parker in 1954. there were cases in the early 20th century and late 19th century which were also fairly deferential to eminent domain, but if you look at those case as i did in great detail in the one of my articles, none of those cases actually addressed the public use clause of the fifth amendment. rather, those cases were heard during a period when the supreme court had not yet taped into view the -- [inaudible] so, therefore, the only way to challenge a state take -- taking in a federal court was the. 14th amendment. and under that clause the supreme court applied a fairly deferential approach although not as deferential as later in berman and kilo under the public use clause. however, in the rare instances during that period when the federal government undertook a condemnation that was challenged in federal court, the supreme
court actually made clear in the 1896 gettysburg case that a higher level of scrutiny should apply when the taking and transfer of property to a private individual. unfortunately, there is some misunderstanding over this fostered in part by the supreme court in kilo where they claim there was 100 years of precedent backing their position. there was, indeed, precedent beginning in berman, but every one of the cases they cited before then was, in fact, a case that had nothing to do with the public use clause of the fifth amendment but was in reality a so-called substantive due process case under the 14th amendment. >> thank you. >> [inaudible] >> thank you very much, will chair. as a preliminary comment, i just want to say that i had concern about the title of this briefing from the very beginning because it seemed conclusory in its title saying that there were civil rights implications of eminent domain abuse as if that,
indeed, a matter of fact. and i think that was, unfortunately, mirror inside a comment that the administrator just stated on the video where he said that the commission calls this eminent domain abuse which we have not yet done. we have not yet said that, this briefing does not state that, this is a very different kind of creature. >> [inaudible] >> i understand, and it's something that we are very sensitive to here. >> although our local committee unanimously -- >> yeah. the committee, but you said -- >> you're right. >> -- the commission which was a step beyond. and that's why i was concerned about this title. i'm also concerned about how, whether this panel is truly balanced or not which i've stated in years past. but beside that, that's beside the point. i want to talk about i was a local government official. i've, i was involved in the use of eminent domain, and i though
that abuses have occurred in the past. abuses in the early '60s or the '50s. there was a thriving african-american neighborhood in san francisco, and there was a lot of relocation and uprooting through there. i also know that there's a lot of good that has been done from what we have done as well. in fact, when you see parts of san francisco now that have been through a redevelopment process, it's a wonder what has occurred in terms of the jobs and the economic growth that has occurred. i am not one who believes throwing the baby out with the bath water which is, seems to be part of what i've been hearing here today. because if there are issues that need to be addressed, they can be addressed. but i'm not as unarguably convinced that the whole mention of eminent domain is by it an
evil. and i just want to ask a question to mr. byrne and also mr. shelton. i think that part of, part of the sort of parade of horribles that have occurred in the past is precisely because they occurred in the past during a very different time before the civil rights act of '64, before the voting rights act, before, actually more importantly, redistricting one person and one vote cases that helped create seats for minorities have political power at the table. i just want would like your comment on whether or not those changes in the last 10, 20, 30 years are important developments in protection against the potential for uprooting, relocation of minority or disempowered communities. >> well, it's my view that it is. one can't say that in every community that minorities have the kind of political power that they have in san francisco.
but i'm sure you know from your experience in local government there that elected officials in a city would, are -- understand the difficulties of taking anybody's home and particularly doing so in a way that has an ethnic or racial tilt. it creates a kind of a political, political firestorm that is a major deterrent. one of the things about urban renewal was that the structure of urban renewal was such that mayors could bypass the local political processes by working with federal agencies. money would flow directly to specialized local government entities dominated by the mayor and pursue projects over which the normal sort of citizen processes -- as imperfect as
they were -- had really no effect. this has been wonderfully blustrate inside a book mac trend .. know, one can't say that there's never abuse of eminent domain in contemporary cities, but i think that the realities of the political process in which there is not a federal pipeline like that, in which the political processes of nearly every american city have been substantially democratized in terms of race and ethnic participation, and in which the money to be able to accomplish these things, a lot of it has to come through local sources. um, the kilo case itself is a reasonable example of that where the use of eminent domain there was pursuant to a fixed state program that was approved by the new london city council after
extensive political discussion. and justice stevens in his opinion pointed at the fact there had been an elaborate political process in place to the determine that new london was blighted, that this project was an appropriate response or appropriate attempt to remedy that problem. so can we do more to make participation better? yes, and i appreciated mr. shelton's commentses in that regard. but we've come a long way. >> i would agree. um, there are too many challenges and problems with those who don't have political power, economic power, so forth when the issues of eminent domain come about. quite frankly, we are disproportionately poor. the property values are disproportionately low, and it becomes a bargain for those who want to buy in lots in one place and do some major project whether it's a local government project or a private project for that matter. we've got a lot of concerns with people that feel they have not had an opportunity to fully
participate in making the decision, and that's why we make recommendations to address the problem. but also i think what you're getting at, commissioner, that we also strongly agree with is that there are a number of examples of eminent domain projects that prove to be very, very helpful. you are sensitive to the issues of the poor that live this those communities, there are examples in brooklyn and even manhattan where major construction projects actually made sure they honed in on those who were poor, created rent control scenarios for those who were able to come in and get first priority coming back in at the same rate. that is not done everywhere, and we'd love to see more examples that should be utilized across the country, but the safeguards are necessary because there are those officials who will exploit the opportunity. >> i just want to make a comment, and then that'll be it. i was going to agree with you because one of the things when we were doing this new project called mission bay in san francisco, one of the associations i was engaged in was setting aside a good proportion of homes not just for low income, permanent home
ownership as well as low income permanent rentals. so you actually see on some of the sides of these buildings homes in the low, well, for san francisco whatever it is which is still way beyond what any normal person would do, but it's still very, an affordable level that we deliberately chose to insure that we would have a diversified, mixed community and allow people the chance to come back. and this is pretty much a brand new neighborhood where there's no displacement other than bricks, mortar and a lot of toxic stuff. >> absolutely. and, again, the problem is those are still too few and far between. we'd love to see more of that happen. what we're seeing too often is when major projects like these occur, we see our folks find themselves in situations they cannot afford to come back into the communities they left. indeed, we also find one of the topics not discussed is when you talk about people of low and moderate income, they develop other forms of capital among
themselves whether it's one mother baby sitting for another mother while they go to the grocery store, you bring me back a gallon of milk. that as is not talked about, and we have to talk about those as well. >> professor, just briefly go ahead. >> let me briefly say the issue of lack of balance, major todd strange, officials in montgomery were invited to come here today, and they did not come here. they have repeatedly taken that position and, again, we have the death certificate here, somebody that they still identify as the owner of a property. if that isn't eminent domain abuse or abuse of property rights, i don't know what it is. so my recommendation is that the commission bring in the mayor, ask him to come, ask karen jones to come, ask these other property owners to come in, and at the very least we want to avoid these kinds of abuses. and it's not the only example of this kind of abuse that has occurred. >> the chair recognizes vice chair dunstrom.
>> thank you very much and thank you to all -- [inaudible] i'm going to lose my voice. but, anyway, all members of the panel. this has been an issue i've long been indirectly involved in since i'm -- oh, i'm sorry. my voice wasn't picked up. i was just thanking the panelists. and going on to say this is an issue that i've indirectly been long involved with because i'm on the board and have been for ten years, the board of the institute for justice which, of course, put ql and eminent domain on the national map as it were even though it lost that case. one could argue it won in the court of public opinion, though, that is not what the institute for justice regards as a victory. i have a question for professor somin and really is asking him to comment on something that
professor byrne said. professor byrne has described these decisions as, um, local democracy at bork. at work. reflecting the political judgment of the local communities and, um, and, of course, um, the local democratic processes are something that we all have some republican for. respect for. but i wonder, mr. chairman, if you would be willing to talk a little bit about that issue, and you might want and you can take any example you want, but i've got in mind new london. i don't think that's really an accurate descriptionment --
description of the new london decision to go after homes that were not blighted, and nts were white, low or middle class. i'm not sure, before or after -- professor byrne, why you'd say that. the fact that homes like those in new london were white and middle class explains the political hysteria, and i'm very biased on this whole issue. i wish there were more political hysteria, but in any case, professor somin, i wonder if you would speak to the issue of the kind of democratic quality of these processes. >> sure. certainly. so just a brief comment on the issue of blight. you are, of course, correct, no one claimed including the city
government that these homes in new london before blighted. in fact, that's the whole reason why the supreme court took the case in the first place, because it was a case of a pure economic development taken where there was no allegation of blight contrary to what i think professor byrne may have inadd inadvertently suggests a few moments ago. on the broader issue of democracy, at some level, yes, almost anything a local government does can be characterized as the actions of local democracy. but, of course, that doesn't resolve the issue of whether there should be constitutional rights to constrain that if local government engaged in censorship or unreasonable searches and seizures, all of those things can be seen as exercise of local democracy as well and sometimes have the support of the majority of the population, but that doesn't mean they don't violate the constitution and doesn't mean they aren't of concern. if you look more closely at how these sorts of takings work both in new london and elsewhere,
it's actually often very difficult for voters and ordinary people to exercise real influence over what's going on for two reasons. one is many of these projects are very complex and difficult for nonexperts to assess, and often it's not evident for many years after the fact whether the economic development that suppose we justify the taking is actually produced. for that reason because of the difficulty of acquiring knowledge about these matters, often ordinary voters have little or no real influence over what's going on. often they don't even know what is going on. in addition, obviously, both in new london and in other places powerful interest groups are heavily involved in the process, politically connected developers and others. in the new london case, a key role was played by the pfizer corporation which had lobbied for the taking of the one of the city's own experts in the case testified that pfizer was the,
quote, 10,000-pound gorilla behind the taking. the new london development corporation, the quasi-governmental agency that organized the condemnation at the time the chair of the agency, her spouse was actually an important pfizer executive. now, having studiesed the case -- studies the case, it is not my view she undertook the condemnation just because she thought it would benefit pfizer. i think she genuinely believed it was in the public interest, but that's sometimes influenced by, you know, these sorts of connections. if you work for general motors, you tend to believe that's what good for general motors is good for america, and if you have a close connection to pfizer, you might believe the same about them. so at some level, yes, this is an act of local democracy just as is anything that is done by local government. at the same time, this is an area where the democratic process often work quite poor and is often heavily influenced
by interest groups. the one last point i'll make about this is i feel the panel is certainly a sign of great progress that african-americans have much more political power than they used to in the past in the urban areas, but that does not prevent, in many cases, the kind of abuse because of the people usually targeted by this sort of thing are, in fact, the urban and minority poor and lot of studies as well as common sense suggests that those groups have only very limited political influence, and urban politician like other politicians if they want to stay in power, they need to favor the interests of those with political leverage over those who do not. >> [inaudible] >> yes, thank you. so i didn't mean to say that there was, that there was a blight finding in the kilo case. if i did, i misspoke. in fact, i had an interesting conversation with a connecticut state official who said to me
that they proceeded under a different provision of the connecticut state law involving eminent domain which allowed there to be eminent domain when there was a finding of economic stress in a city and that could be shown that the project would address the economic distress of the city. connecticut used that process because they thought it was more transparent. professor somin before correctly, i think, said that the blight determinations that exist are often quite elastic, and the term "blight" is a kind of a stand-in for a need for economic development, and it's a troubling term. connecticut was trying to avoid that and making it more transparent. now, um, the history of the taking in the new london is very complicated and interesting. but it's fair to say that the dissenters in the connecticut supreme court who voted to find that the use of 'em innocent domain -- eminent domain was against state law specifically
found that the project was not done for the benefit of pfizer. it was done because pfizer had already located a test facility in new london. at the same time that the navy had -- or the coast guard had abandoned a military site. and the hope was that by redeveloping this part of town, they could attract other corporate development. um, there's no, there's absolutely no proof that there was anything untoward done on the basis of the decisions, and and as i say, it wasn't just done by the new london development corporation. it was specifically approved by the new london, by the new london city council. now, look, nobody says that politics at the local level as at the federal level is without the influence of powerful entities what's needed, of course, is more transparency and
more participation. and i strongly back that. but i stand by my, by my view that those are the proper remedies and not taking away an entire power from local governments to engage in economic redevelopment. >> i'm going to ask a question, then -- >> whatever order. >> that's fine. and commissioner harriet, commissioner kline. last week the pew research center issued a report that shows that the net worth of minorities, especially latinos and african-americans, has plummeted particularly due to the current economic conditions that we find such that latinos and african-americans' net worth now is 22 time less than white americans. and i think there's a civil rights issue embedded there, but that's not what i'm going to ask you about. most of the wealth that minorities have accumulated in the past has been based op our homes. -- on our homes. however, i think when you look
at minority communities and immigrant communities, one of the ways to find success has been through entrepreneurial efforts, and you and your comments, professor byrne, mentioned the distinct between compensation for homes and compensation for businesses. do you make a distinction between a business that may be a family-owned business or family-run business versus something that is owned by a corporate entity, and could you speak to that? >> sure. i don't have any problem with the idea that it would be a good idea to provide growing concern value as part of compensation, particularly for small businesses. what i was trying to draw attention to was that the proposal to prevent or to prohibit abusive eminent domain for economic development would also prevent use of eminent domain on vacant lots held by investors in which there is no going concern value, but merely an attempt to try to speculate.
so it -- so i agree with you, and i think that that is, i think that the remedies that look to increase compensation which shifts the calculus involved in the use of 'em innocent domain is a very fruitful avenue for further study. >> thank you. commissioner grass yang know? >> >> thank you, all, but i kind of particularly thank professor byrne because it helps me understand those people who like you who say there isn't a problem, that this is a solution in search of a problem. and i'd like to mention two, um, matters that seem, you seemed to raise that bother me and get your reaction as well as professor somin. the first is that if some of the people involved in the coalition concerned about eminent domain are libertarians and be they happen to have a concern about the scope of government power,
you didn't imply that they can't really be motivated by the plight of minority students, but you seem to say, well, that could, that that isn't, that that isn't. it bothers many he to -- me to suggest that just because one might be libertarian one isn't powerfully moved by the special plight of poor and particularly minority. it certainly isn't the case that those who were concerned about voting rights generally couldn't have been powerfully moved, the north by some of the examples that this commission showed the plight of blacks in the deep south in the '50s and the '60s. so that's one concern i have. um, the second is the notion that seemed to animate part of the written submission and oral that as long as government has
the right motives, then government will usually help minorities more. and i'm glad we're beyond the stage where, um, you know, a lot of eminent domain may be motivated by racism. but the history of urban renewal is littered with so many devastating mistakes, um, the hud probably had the best motives to group people in these huge, horrible housings. you in your testimony seem to suggest that mixed use is a great thing, and government is best to decide. i became involved in the issue about 4 years -- 24 years ago in a zoning fight in houston, became acquainted with the now-deceased but beloved colleague of commissioner harriet's on the university of san diego, usd, i should say, bernie segin who did a study. back then the city of houston
wanted to end mixed uses because to them in their covenant neighborhoods, mixed uses that the poor had -- and i was in one of the, you know, more well-off neighborhoods -- were ugly. but his pathbreaking book and many of the other fallout studies showed that, in fact, what was unappealing to government at the time, um, really decreased rents for minorities compared to dallas and other cities. so i suppose my question to both you and professor somin is whether we should be so trusting of government even when they're supposedly well meaning? >> well, thank you for your question. first off, um, thank you for, um, the comment that -- and i totally agree that libertarians can be motivated quite sincerely by concern about the plight of
the least among us or racial discrimination as part of the response that they make. and i hope -- but let's -- the, that was not what kilo was about. kilo was not about racial minorities. and the focus of the institute for justice has not been, has been on property owners' court, on eliminating eminent domain for economic development entirely. and so it seems to me, and the way in which the issue was framed to me for this hearing today suggested that the main concern of the civil rights commission was the undue impact of eminent domain on minorities, and that's what my remarks were addressed to. but the solution that's being suggested both by professor somin and, i suppose, by yourself is to eliminate eminent domain for economic development
period. and that does not address the harms that come to minors that come from highways or public housing for that matter, and it takes away one of the tools that have been, that has been used to try to maintain the economic competitiveness of cities with greenfield -- [inaudible] so i do have concern as to what the focus of this discussion is about, and i don't mean to impugn anybody's motives or, or -- at all. and and i'm sorry if it seems as if i did. now, you're making then, commissioner, a very broad argument about the, whether government has a role in land use regulation at all. and i understand that there are people, and bernard segin is certainly one, who have argued over the years that that power is, um, is unhelpful.
the problems with eminent -- so, and mistakes have been made. i mean, urban renewal has a very mixed legacy, and, you know, the definitive book has not been written on that yet. but, plainly, mistakes were made, and mistakes are being made today in government policy involving urban development. however, urban, the understanding of urban planning has come a long way since the 1950s. we have a much less grandiose idea, we understand the value of mixed development, and we understand the limited role that government can play as a catalyst in, um, helping particularly redevelopment of areas that need it. t a very large -- it's a very large question to discuss whether government has a role, what the role of government properly should be in land use planning regulation, goes well beyond the issue of eminent
domain. but it is certainly the case that we can point to uses of eminent domain in the last decade that have been, in fact, very helpful. the government can assemble plots of land in a way that private developers cannot. they can overcome holdouts, they can insist on, they can insist on a planning process that involves the community. and i think that's valuable. and the, the larger issues perhaps save for another day. >> professor somin, are you now or have you ever been a libertarian? [laughter] >> i've been a libertarian since i was 15 years old, and i even described how i first became libertarian. perhaps more relevant to your specific question, i think there is no contradiction between advocating for property rights for the poor while also believing that the same property rights should apply to the wealthy and others just as there
is -- [inaudible] with our view that these protections should apply to powerful media entities like "the new york times" and not just unpopular speakers. so, similarly, i think property rights apply the all. that said, as discussed in my testimony, it is the case that the poor and politically weak with respect to speech are all the more vulnerable. and that does get to the question of the role of government. one of the reasons why i'm libertarian in the first place and others are as well is that problems with government are not directly the result of particular planning processes or particular individuals who might make mistakes, they're also systematic, and government does have a tendency to favor the politically powerful over the politically weak, particularly in areas like eminent domain where the issue is complex, and it's difficult for the general public to scrutinize what is going on. you don't have to be
alibertarian to recognize this particular problem, but i think the libertarians and their contribution to this debate is to see its systematic nature. now, with regards to the question of the broader role of government, obviously, like professor byrne, i don't think i can fully address that question in this hearing. however, i would note that i think both 1950s urban planning and modern urban planning tends to oversaying what the -- overstate what the appropriate role of government here is. it's true there are holdout problems, but as i discussed in my testimony, private developers have good way of overcoming them, one of them being secret assembly. and those have is the advantage -- have the advantage that they don't victimize the poor and the pretty create weak nearly as -- politically weak nearly as much, and they require the developer to pay for the project with their own money, right? >> when the developers pay with their own money, they have more incentive to actually do a project that will promote more economic growth than it destroys
whereas when they can do so with heavy public subsidies to transfer other people's property to them, you often get very bad results. not in every single case, but i think in the majority of the time i give a couple of examples in my written testimony. i just mentioned the kilo case which has already been discussed a lot. to date some $80 million in public funds has been spent there, and so far years after the taking nothing has been built. the only beneficiaries of the taking so far other than the, you know, other than, you know, officials and lawyers involved are some feral cats that are currently living on site. .. the
>> than from ones that transfer lands from private parties because as i indicated the way private developers get arnholdout problems is by operating in secret and not letting people know this is a big assembly project that's going on with a public project where public funds are being spent, we do want public scrutiny and even if we didn't want it we'd probably get it anyway because government tends to leak if they can't keep military secrets they probably can't keep development projects secrets either even if we wanted them to do so. >> professor, i'm glad you're
answering the political philosophy because it would be highly ironic if you answered your system. [laughter] >> the chair recognizes commissioner harriet. >> thank you, mr. chairman. i want to say a word on behalf of them of $80 million but at least i'm happy for the ferreal cats. professor coleman you had mentioned there are more effective methods of dealing with the urban blight. can you elaborate on that a little bit. >> sure. i think urban blight is a genuine problem which i mean blight which really are blighted in the term where dilapidatedtation, threats to public health and the like. i think the best and most effective long-term method is dealing with this is having long-term growth and property rights are actually an important part of that. most scholars in economics the problems going on in
underdeveloped world is underdeveloped property rights and there's a series of books on this. i think in a number of urban development scholars also think we have a similar problem albeit in a less severe form some in fact poorer and less developed areas of our own country. in addition, while long-term growth is the best solution, there are other more targeted measures that can be taken, for instance, public health codes, the situation where maybe there are infectious diseases breeding in a particular property owner's area. and also in some cases one can use nuisance abatement and private losses. and finally we should promote legislation that's already been done in many states that should have more private plan communities so people can use their own money and their own voluntary cooperation to create a better living space for themselves. today over 50 million americans already live in private planned
communities of various types. and more can be done to make that option available to even more people and i think actually that's the kind of participation which is often more effective in promoting people's interests than the ordinary political process is. so i don't think there's an absolutely perfect solution to blight. however, there's a great deal that can be done without resorting to eminent domain and especially since these other approaches -- they have the advantage that they don't forcibly displace people from their homes or away from their businesses. taking the target small businesses often inflict as much harm as target homes but the public sympathy in those cases tend to be less. >> we have less than 10 minutes left for questions. i have the commissioner who will be next. and prior to doing that i would ask if the commissioner had an opportunity -- she had an opportunity to do so.
and that may be our time. so commissioner? >> thank you, mr. chairman. thanks to the panel. professor, i read your testimony and you were shocked they actually had eminent domain in downtown las vegas as well as time's square. were you ever in time's square in the early '80s? >> yes, actually, i was. >> do you want to admit that? >> i should wait and let you finish your question. [laughter] >> as young looking as you do. i too will be a libertarian. [laughter] >> but i was, and i think that their redevelopment plan has been successful. would you not agree? >> to some extent, however what i was referring to took place in the early 1980s and it specifically with a taking the transfer of property that by normal standards was not in any
way blighted to the "new york times" for purpose of building a new headquarters. >> you were referring to the general condition of times square in the early 80s. >> i was referring to times squares at the time this case occurred which was in 2001. >> right. and then the taking in downtown las vegas. have you ever been around that property? >> yes. >> and that taking was really a problem of notice, was it not? >> no. >> not without having an order to enter? >> are you referring to the -- the fundamental issue there was, in fact, whether the area was blighted. and the owners of the land said it was not and it went all the way to the state supreme court and they ruled it was blighted on the grounds of nevada the definition of blight at the time was any area that was underdeveloped in some way, or which essentially was any area
which does not have as much development as produced by alternative use. so there may have been other procedural issues in the case but the aspect that i was referring to, the one addressed by the nevada supreme court was specifically the question as to whether the area was blighted or not and the nevada supreme court ruled that it was on the basis of this very broad standard. >> and then your last remark in your comments was more work was needed to ensure a constitutional property rights. has any of these types of cases shown a violation of civil rights and property rights like kelo and the hawaiian housing thought which stand these court tests, the constitutionality. >> it was a close 5-4 decision. i believe the majority in that case got it wrong as many of the cases do. there's some lower court decisions which have struck down takings on the basis that the official rationale was
pretextual. and there also have been a number of state supreme court decisions which have invalidate those takings under state constitutions but and part of my testimony was precisely the federal court and some state courts as well have not done enough to approach that piece to the fact that most of these cases are run by the government at least in federal court. i view not as a positive sign that nothing bad is going on but rather as a negative sign that, unfortunately, the courts have not been doing their job in this area as well as they should. >> the chair recognizes commissioner yonke and commissioner achtenberg will have the last question. >> i want to say one last word to the professor to begin with. what you've been describing in your testimony today to me is very powerful. and if it's indeed the case that they're using this different method of demolition to deal with homes primarily run by
african-americans in montgomery county in montgomery, it is something that i wish we could go down there for because then we could use our subpoena power to force the officials to come forward with those records. this is a much broader hearing than that. in terms of what you're talking about, that could be a potential abuse of a police power that i think could have -- we could have a very significant interest in. i just want to address really quickly the alternatives. one of the things you talked about was secret assembly or in other words, we'll call the developer's shell game and they run around and buy little puzzles there and hold in a conglomerate together. i want to get all your options as quickly as possible. to me having watched that and seen that happen in various cities across the country, including my own, the one thing that comes up is the fact that in many ways, one, i don't necessarily think that the developers are paying the highest and best price for some of those properties.
they're paying in more than the government would. and number 2, in doing it in this sort of shell game frequently using nominees shell corporations, other kinds of things to do so, it actually becomes almost undemocratic so that question that mr. shelton would want raised, where are these people going? what are we doing with them? what is their right of return? what actually is going to happen here and whether that is a good and efficient use of property? i don't think those questions ever get answered in the secret assembly type thing until the very end when they may have to go to the planning commission to get it done. by that time, you know, when you have a -- your abilities may or may not be limited at that time in terms of your ability to deal with the issues that have been raised by mr. shelton, and by mr. burton and yourself, too, in terms of on the impact of minorities. i just wanted you to address that and whether there are undemocratic aspects of that, that might actually militate
against some of the comments you were talking about in terms of the perceived ills you see of eminent domain on racial minorities. >> thank you for that question. it's an interesting point. i think the important thing about the secret assembly is that when secret assembly or any kind of voluntary assembly are going on, people don't have to sell unless they agree to the selling price that is offered to them. so as a general rule, if people will not sell unless they feel they are better off with the money than they would be with the property. and that's a fundamental difference from eminent domain. now, whether they always get paid the highest and best price, you know, that may vary depending on who's an effective negotiator or what nnot but they're getting paid a better price than keeping the property. the most important property rights is the ability to say no when people come and say i want
your land or whatever it is that you own. you might say it's undemocratic in the sense that, obviously, until the project is later announced, it's secret but i think part of the point of my argument is that a better way for people to participate is to be able to make their own decisions about the disposition of their property and to be able to say yes or no to the offers that are brought to them rather than having a voice in the political process whereas an individual particularly, a poor one, your chance of influencing the outcome is small. by contrast, if you can say yes or no to offers that are brought to you, then you have a much higher chance of actually having a say in your on own fate. so if you believe the money being offered is not enough and you'll end up living somewhere else or be worse off, then you can just say no. i think that's a good thing from a fairness perspective. it's also by the way a good thing from the perspective of maximizing economic efficiency
and economic development. if, in fact, the current owners of property value it more than the developer does, then even if all you care about economic efficiency if you're like -- a libertarian of stereotype only cares about economic growth or whatever, then you still would want the secret assembly rather than eminent domain because you would want those projects that are not worth more than the existing uses that they would displace. >> the chair recognizes commissioner achtenberg for the last question. >> i want to direct this question to professor burn if i might. my concern in reading the material has been that the data, at least as far as i can tell, is questionable in terms of the
statistics that have -- that are available to us about what has happened since 1980 or 1990 or in the most recent decade past in terms of the allegations that it is clearly a disparate impact that's being felt as a result of eminent domain on minorities and other disempowered communities. i'm wondering, am i missing something or is the data as scanty as our current records makes it appear? >> i think -- i think -- i think there's a big problem with a lack of empirical study of the employment of eminent domain. certainly, as you say in the last two decades or so, done to rigorous social science standards. we really don't know very much
about the incidents and who's affected by it. and so i think that would be an enormous benefit. and i think something that's agreed across the political spectrum that a better understanding of what actually occurs would be helpful. the study referred to in terms of the victims and whatnot that's in there, really doesn't look at who's affected. it just looks at the census tracks in which eminent domain is used and that just doesn't tell you very much. and we could use -- we could all understand this better. >> thank you. please, everyone, join me in thanking or panelists. [applause] >> i think we had a very thoughtful and thought provoking discussion this morning. i just want everyone to know who's listening here today that we're going to have the record remain open until september 10th for any public comments.
those public comments can be mailed either to our office here at 624 ninth northwest, washington, d.c., 20425 or emailed to firstname.lastname@example.org. that's public comment one word at usccr.gov. thank you all and we're going to move immediately into our regular business meeting. so thank you, analysts you may go about your business. feel free to stay and watch our business meeting >> tonight on "the communicators," we'll hear about legislative proposals in congress for addressing the issue of cybersecurity. our guests include texas representative mac thornberry, chairman of the republican task force on cybersecurity, and rhode island democratic congressman jim langevin who co-founded the first-ever house cybersecurity caucus in 2008.
"the communicators" airs monday nights at 8 eastern on c-span2. >> booktv continues its monthlong schedule of prime time programming. tonight we look at politics and the american novelist. beginning at 8:30 p.m. eastern, you'll hear from editor robert hearst as he describes the work preparing volume one of the autobiography of mark twain. then professor david reynolds explores the political and social factors that influenced harriet beecher stowe's classic 234068 in mightier than the sword, uncle tom's cabin and the battle for america. after that, harriet risen talks about her biography of louisa may alcott, author of "little women." all this month on c-span2. >> watch more video of the candidates, see what political reporters are saying and track the latest campaign contributions with c-span's web site for campaign 2012.
easy to use, it helps you navigate the political landscape with twitter feeds and facebook updates from the campaigns, candidate bios and the latest polling data. plus links to c-span media partners in the early caucus states. c-span.org/campaign 2012. >> earlier today former louisiana governor buddy romer criticized president obama and the current candidates for their fund raising practices including accepting money from political action committees. he also called for the energy department to be eliminated and for the u.s. tax code to be reformed. held at the national press club, this is an hour. >> thank you, it's an honor to be here. welcome, everybody. i believe america's a great nation.
all things are possible regardless of your starting point in life. most nations have strong points, decent people, and its own opportunities. i do not put them down. but america's always been a special land, formed by the lek rah ration -- declaration of independence and then the constitution to stand against the tyranny of a foreign king and a culture of elitism and class segregation in england. america has prospered into the world's greatest economic power, the land of opportunity. i run for president because america's a great nation and a great people, and america's in trouble. 20% of its work force, 25 million americans, are out of work in this recovery or have quit looking or are
underemployed. we have a million fewer jobs than 12 years ago. and the jobs we have pay less. we've given away our manufacturing jobs, we don't make things anymore. we distribute them. bad trade. made in america is an endangered species. we're now dependent on consumption and government. we owe more than any nation ever. we face be endless deficits averaging $1.1 trillion a year for the next decade. we have undisciplined spending. we borrow 42 cents out of every dollar spent. we have an unreadable tax code laced with loopholes. interestingly, the bulk of our debt comes from our competitors.
in that same vein, we're addicted to foreign oil. we refuse to seal our own borders, and we have decided to rebuild be other nations while paralyzed in attempts to help our own. it is unsustainable. america. growth is the only solution in the 21st century. if we plan a nation better than we received, if we plan to work our way free again. growth be is essential to the land -- growth is essential to the land of opportunity. we can do this. this can be done. i am positive on america. we can grow again. at least a half a dozen strong initiatives must be employed.
we must level the playing field against those nations who compete unfairly, choosing to steal our best jobs. will they use child labor, forced labor, prison labor, no work safety or health or environmental standards. hidden barriers to the flow of trade and even current si manipulation. currency manipulation. we have outlined a specific set of remedies that will be featured in my next major speech be in new york. a president must defend american jobs from unfair foreign competition. we have waited too long and for some it is too late. but these unfair practices will no longer be tolerated when i am president. i will call them out one by one.
we must win the battle to control federal spending. at 25% of gdp is an excessive, unsustainable and confidence-destroying facet of our nation. for six months i've detailed a 1% per year reduction in spending, my idea. it'll take us five years to do it. that's $140 billion a year. reduction begins with energy subsidies including ethanol, oil and natural gas. the elimination of the department of energy and modifying entitlements, year one. we must deregulate small business beginning with rigs and regulations imposed since january 1, 2008. and extend that deregulation period forward for five additional years.
from the president, wow. two out of every three jobs in america are formed by small businesses. that's defined as 499 mows or few -- employees or fewer. 81,000 pages in the federal register last year alone of new regulatory comment on small business. they don't have a lobbyist. they don't have big checks. they just work for a living, and they build america. two out of every three new jobs. they're the key. regulations are the new taxes. we'll deregulate 'em. health care costs must be lowered. i'm a diabetic. for more than 40 years. i understand the business. we must eliminate costs. we'll start with obamacare itself. we'll institute tort reform. we'll open insurance competition across state lines. so simple, so hard to do.
they get big money. we'll expose pharmaceuticals to price competition, and we'll incentivize providers to reduce expense bees by allowing them -- expenses by allowing them to keep 25% of what they save. we should be energy independent in a decade. we'll drill where there's oil and gas. we'll drill safely, we'll put a million people to work, we'll use all domestic forms of energy, we'll eliminate the department of energy. we'll tariff foreign oil except canada and mexico. we'll save $500 billion a year spent overseas on foreign oil, it'll be spent in america on our uses. we'll restore the value of the dollar and reduce the cost of gasoline by doing just that. we must completely revise our tax code for growth. low marginal rates for individuals and companies with
no loopholes and deductions. we'll make the u.s. a tax haven with low marginal rates and minimum tax investment in capital gains. simple is the keyword. adequate for the job and not a penny more. finally, banking must be reworked by having capital ratios rise as banks grow larger. they are unsafe. we'll eliminate too big to fail. we'll restore a version of glass-steagall. much needs to be done, but that's not what i'm going to talk about today. none of these things will happen under the current political system. special interests own this tournament -- own own this town. special interests own this capitol. special interests own the tax code. special interests own the budget.
they bought and paid for it. the tyranny of the big check, i call it. we need to make changes to grow. we need to take bold action, but special interests have never had it so good. why should they change? corporations have never made more money than they've made the last 12 months. why should they change? our political system, our capital is institutionally corrupt. i'm not pointing my finger at some person, although you could do that. i'm pointing it at a system. special interests write the tax code. you can't read it. they can. every year the cost of elections rise three billion, four billion, five billion, six billion, and the same 1 or 2% of
americans give all the money. 98% give nothing. and that's what we've got. we are owned at the top by pac money, special interest money, wall street money, by the big check. and it's getting worse. let's look at the record. health care reform didn't include tort reform. i wonder why that was? tort lawyers give a lot to both parties. we did it in louisiana. you'd have thought i was the devil himself, but we did it and lowered our costs. health care reform under president obama didn't include the requirement that insurance companies had to compete across state lines. you can't buy a policy across state lines now, prohibited. it's in the law.
big givers, those insurance companies, those rascals. it didn't require pharmaceutical companies to compete on price. oh, no. big bucks, these guys have. big bucks. a 2300-page bill was produced, unconstitutional in its mandate to citizens, and it didn't touch three of the biggest health care costs on earth. read jonathan alter's book "the promise" about the pharmaceutical industry as an example. special interest money is the biggest. did you know that washington, d.c. addresses and lobbyists and pacs gave more money in the last presidential campaign than 32 states combined? you didn't know that, did you?
i guess it's just an accident. and it's worse now than four years ago. we've got the pacs, the political action committees, who can give twice as much as individuals. why is that? and there's no limit on the number of pacs. they're the bundlers. now, a happy crew. they're designated by the candidate to go around and pick up checks. they raise money. bundlers, they're called. they collect others' checks and give them to the candidate, 100,000, 200,000, 500,000, two million in mitt romney's case. he had 25 designated bundlers to raise two million each. i read a harvard law school
student paper recently. he let me do it. where he looked at the givers in presidential campaigns, the bundlers. see what happens to them. he called it checkbook diplomacy. normally in a presidential term about 30% of the ambassadorial appointments are political, 70% not. obama's 57% political. 23% of them were bundlers. oh, i'll give you some names. japan, 500,000 he gave. sussman, great britain. 500,000. rivkin, france. 800,000. gutman, belgium, 775,000. bayer, switzerland.
745,000 bucks. on and on. 24 of obama's nominees bundle over $11 million. the number's hard to come out with because there's no full disclosure and just ranges are given. the minimum range is at 11 million. and by the way, that doesn't include money to the inaugural committee, the leadership pac or the dnc. both sides do it. i don't mean to just pick on the president. he's the worst, but both sides do it. his 30:70 ratio is 65% be political. selling important jobs like a third world nation. it's not right, it's not healthy, it's not good for america.
the tyranny of the big check. lobbyists who are fund raisers. you can be one or the other. i don't have a problem with either one. i know when i was a congressman, although i didn't take pac money, i did accept a meeting with a lobbyist who represented a viewpoint. ideas are critical. knowledge of an industry's critical. it is a valid job to be a lobbyist. but not where all you do is bring a check. i think a registered lobby should not be allowed to both lobby and fund raise. that's very specific. you know who agrees with me? the american bar association, just last week. the name jack abramoff comes to mind. special interest money, c